"Now we're introducing rules that are more favorable if you have a fixed-rate mortgage and want to switch banks. This is an important step to strengthen consumer protection in the mortgage market", says Minister for Financial Markets Niklas Wykman (M) in a press release.
The so-called interest rate differential compensation is a fee that banks are entitled to charge if someone wants to terminate their fixed-rate mortgage prematurely, for example to switch banks.
The proposal will come into effect on July 1 next year.
Today's system with interest rate differential compensation can be costly for bank customers and has been criticized from various quarters, including the Financial Supervisory Authority, which believes that it primarily benefits the banks.
The Swedish Bankers' Association has, however, opposed parts of the change in a consultation response. The industry organization, for example, does not want incentives to arise for borrowers to repay a loan prematurely simply because it is profitable to do so.
