Car Loan in Norway – What to Know Before Buying a Car?

Can you get a car loan without a down payment?

Yes, in Norway, you can obtain a car loan without a down payment. There are two main types of loans:

• Secured car loan (billån med sikkerhet) – the bank becomes a co-owner of the car until the loan is repaid. This type of loan usually has lower interest rates but requires a down payment, typically at least 20% of the vehicle's value.
• Unsecured loan (forbrukslån / billån uten sikkerhet) – does not require a down payment or collateral on the car. You can finance 100% of the purchase with the loan, but costs may be higher due to interest rates. This type of loan gives you more freedom – the car is fully yours from the start.

Did you know that having a larger down payment can get you better loan terms?

The size of the down payment significantly affects the terms offered by the bank – especially regarding interest rates. The greater your contribution to financing the car purchase, the lower the risk for the bank – which usually means more favorable interest rates and lower overall loan costs.

Example: Car loan for 200,000 NOK

As you can see, even a small down payment can result in lower monthly payments and reduced loan costs over the repayment period. If you have savings – it's worth using them as part of financing the car purchase.

What should you consider before choosing a loan?

Before deciding on a specific loan offer, compare the key parameters:

• APR (Annual Percentage Rate) – this is the most reliable indicator of loan costs. It includes not only interest but also additional fees.
• Repayment period – the longer it is, the lower the monthly payments, but also the higher the total loan cost.
• Early repayment option – check if you can prepay or repay the loan early without additional costs.
• Monthly payment amount – it's good to choose one that won't strain your monthly budget.
• Offer flexibility – some banks allow combining the loan with additional costs, such as:
  -vehicle registration (omregistreringsavgift),
  -insurance (forsikring),
  -possible repairs or additional car equipment.

Remember: a well-chosen loan will not only help you finance the car purchase but also won't overly burden your finances in the long term.

Who can apply for a car loan in Norway?

To obtain a car loan in Norway, you must meet certain bank requirements. Our partner, Eiendomsfinans, applies the following criteria:

• Stable income from work or business in Norway
• At least 23 years old
• Registered address in Norway
• No active debt collection cases (inkasso) and arrears
• In some cases, the bank may require additional documents – e.g., income confirmation from the last 3 months or a tax return (skattemelding).

Example: Used car loan for 200,000 NOK

Suppose you want to buy a car in Norway for 200,000 NOK – a 2-3-year-old car in good condition. Let's see how the loan repayment might look in two scenarios:

1. Secured car loan (billån med sikkerhet)

• Loan amount: 200,000 NOK
• Repayment period: 5 years (60 months)
• Interest rate: 7.5%
• Monthly payment: approx. 4,020 NOK
• Total loan cost: approx. 241,200 NOK

This type of loan usually requires a down payment of at least 20% (i.e., 40,000 NOK), and the car is collateral for the bank. In return, you get a lower interest rate.

2. Unsecured loan (billån uten sikkerhet / forbrukslån)

• Loan amount: 200,000 NOK
• Repayment period: 5 years (60 months)
• Interest rate: 12.5%
• Monthly payment: approx. 4,500 NOK
• Total loan cost: approx. 270,000 NOK

You don't need a down payment or collateral. The car is fully yours, but the loan cost is higher.

Loan vs. Leasing – Which is More Beneficial?

Many Poles living in Norway wonder whether it's more beneficial to buy a car with a loan or lease it. The answer depends on several factors: the type of car, the planned usage period, the possibility of purchase, and most importantly – the purpose of the purchase (private or business).

Leasing in Norway is most often available to companies or individuals conducting business, but some leasing companies also offer private leasing (privatleasing). The differences between a loan and leasing are well illustrated by the following simulation:

Example: Used car worth 200,000 NOK – usage for 3 years

Option 1: Car loan (billån uten sikkerhet)

• Loan amount: 200,000 NOK
• Repayment period: 5 years
• Interest rate: 12.5%
• Monthly payment: approx. 4,500 NOK
• Total cost over 3 years (36 payments): approx. 162,000 NOK
• After 3 years: the car is still yours and you can sell it – e.g., for approx. 110,000–130,000 NOK

Advantages: the car becomes your property, you can sell it or continue using it

Disadvantages: higher payments, greater responsibility for the vehicle's value and insurance

Option 2: Private leasing (privatleasing)

• Monthly leasing payment: 3,900–4,200 NOK (depending on the company and package)
• Contract duration: 36 months
• Initial fee (startleie): approx. 30,000 NOK
• Total cost over 3 years: approx. 170,000–180,000 NOK
• After 3 years: the car returns to the leasing company – you don't sell anything

Advantages: lower monthly payment, no need to sell the car
Disadvantages: you are not the car owner, no residual value, mileage limits, wear and tear fees

Which is more beneficial?

• If you want to drive a new or several-year-old car without attachment and care about a lower monthly payment – leasing may be an option.
• If you plan to keep the car for more than 3 years or sell it and recover some money – car loan is usually more advantageous.

Additionally: a loan gives you full freedom – there are no mileage restrictions, you can choose any insurance, and the car is yours.

Want to check your creditworthiness and see offers from Norwegian banks?

You don't have to analyze complex bank offers yourself. Leave your details, and we'll take care of the rest – we'll compare offers from different banks, check your creditworthiness, and help you choose the best solution. Everything in Polish and without any obligations.

Before applying, you can also check your credit score yourself and see if you have active debts in Norway – use the free tool Gjeldsmonitor, which gives you a quick and convenient overview of your finances.

How can we help you?

Simply put: we understand the needs of Poles living in Norway. By partnering with the experienced Eiendomsfinans, we offer access to car loan offer comparisons from many Norwegian banks – all in one place and without leaving home.

Our Polish-speaking consultant will help you:

• assess your creditworthiness,
• compare available offers,
• fill out the loan application,
• go through the entire process – from A to Z – without stress and language barriers.

Everything is done online, in Polish, and free of charge.