Starting today, May 22, AS INDEXO Bank is launching its mortgage lending services, initially offering refinancing of existing mortgage loans. Over time, the bank will expand its offering to include other types of mortgage products. INDEXO Bank aims to change the market situation in which at least two billion euros in mortgage loans, issued more than five years ago and partially repaid, are still subject to higher interest rates than those currently offered for new loans, despite the significantly reduced risk for banks.
“INDEXO Bank’s refinancing offer is based on the principle of fairness. Over time, loans are gradually repaid, the value of the collateral increases, and most likely, the borrower's income also grows. The bank's risk decreases significantly, but interest rates remain unchanged. Currently, refinancing a mortgage loan is simple and can be done quickly, but it is not actively promoted because the dominant foreign banks in the market are not interested in changing the current situation. As a result, borrowers in Latvia continue to overpay on at least two billion euros worth of mortgage loans. For INDEXO Bank, this is a great opportunity, just like when high fees and bank passivity in the pension management sector allowed INDEXO to disrupt the market and prove that services can be provided at much lower costs to clients. Now we see the opportunity to do the same in the mortgage lending sector,” says Valdis Siksnis, Chairman of the Management Board of INDEXO Bank and one of the founders.
INDEXO Bank’s solution will allow anyone interested to receive a mortgage refinancing offer within just a few minutes using the INDEXO Bank mobile app. The offer will include not only the proposed interest rate for the specific loan but also the available additional loan amount and the option to choose the most suitable monthly payment. Interested parties are encouraged to update or download the INDEXO Bank mobile app to view the offer. This service is already available for iOS users, while Android users will be able to access it in the coming days.
“With the help of the INDEXO mobile app, anyone can find out in just a few minutes whether they are overpaying for their home loan and by how much. The likelihood of overpaying is especially high if the loan was taken between 2010 and 2020. By promoting mortgage refinancing, we will create real value for the people of Latvia and the economy. The more households save on loan payments, the more they can spend on other needs, and thus refinancing expensive loans also promotes the development of other sectors of the Latvian economy,” says Jānis Mūrnieks, Head of the Retail banking segment at INDEXO Bank.
About INDEXO
INDEXO is a financial services group that includes pension management companies and INDEXO Bank.
INDEXO, an investment management company licensed by the Bank of Latvia, offers modern 2nd and 3rd pillar pension plans in Latvia. It is one of the fastest-growing pension managers in the Baltics, with over 144 thousand customers and more than EUR 1.4 billion assets under management.
INDEXO Bank, a credit institution licensed by the European Central Bank, serves over 33 thousand clients, with total client funds amounting to EUR 48.1 million and EUR 9.7 million in issued consumer loans.
Founded and headquartered in Latvia, INDEXO is a Nasdaq Riga-listed company with more than 6,400 shareholders. Its mission is to fight for a better financial environment in Latvia and strengthen the well-being of Latvian residents by providing modern and personalized financial services. For more information visit www.indexo.lv.