Expensive Loan: If The Interest Deduction Is Abolished.

Several million Swedish households have mortgages and several million Swedes have private loans. An abolished interest deduction would have a direct effect on these households. Therefore, one has politically not wanted to take on this issue and constantly pushed it on. But given that interest rates are so low at the moment, it is easier to make an unpopular political decision, which will be the abolition of the interest deduction.

We believe that it is likely that the interest deduction will be phased out, which, for example, could mean that you go from 30% deduction to 20% or that you lower the level where the deduction goes from 30% to 21% by, for example, lower the level from SEK 100,000 to SEK 50,000.

 

Should the interest deduction be abolished?

Should the interest deduction be abolished?

 

Advantages:

– Premiums ownership of housing and can thus stimulate housing construction
– The return on housing in the very long term is generally higher than the GDP rate and it can therefore be economically sound to give the population incentives for ownership

 

Cons:

– Higher debt / equity ratio is rewarded when you get a discount on the interest rate, which interest deduction is actually
– Drive up housing prices
– Inequitable economic distribution policy when those who already have a good position and can borrow money receive additional support from the state
– Great cost for the state
– Does not directly correlate with any tax revenue, which thus constitutes an unpredictable cost for the state

 

Some interest rate examples of how much more expensive your loan will be per year if the interest deduction is abolished:

Formula: Amount of loan x interest rate x interest deduction
Example: 300,000 x 0.1 x 0.3 = 9,000 SEK

 

So much more expensive is your private loan if the interest deduction is abolished:

SEK 500,000, interest 10%: SEK 15,000
SEK 500,000, interest 5%: SEK 7,500
SEK 500,000, interest rate 3%: SEK 4,500
400 , 000 SEK, interest 10%: 12,000 SEK
400 , 000 SEK, interest   5%: 6,000 kr
400 , 000 SEK, interest 3%: 4.0 00 k r
SEK 350,000, interest 10%: SEK 9,500
SEK 350,000, interest 5%: SEK 5,250
SEK 350,000, interest 3%: SEK 3,150
SEK 300,000, interest 10%: SEK 9,000
SEK 300,000, interest 5%: SEK 4,500
SEK 300,000, interest 3%: SEK 2.700
SEK 200,000, interest 10%: SEK 6,000
SEK 200,000, interest 5%: SEK 3,000
SEK 200,000, interest rate 3%: SEK 1,800
SEK 100,000, interest 10%: SEK 3,000
SEK 100,000, interest 5%: SEK 1,500
SEK 100,000, interest 3%: SEK 900
SEK 50,000, interest 10%: SEK 1,500
SEK 50,000, interest 5%: SEK 7,500
SEK 50,000, interest 3%: SEK 450

 

So much more expensive is your mortgage if the interest deduction is abolished:

SEK 10,000,000, interest rate 2.0%: SEK 60,000
SEK 10,000,000, interest 1.5%: SEK 45,000
SEK 9,000,000, interest rate 2.0%: SEK 54,000
SEK 9,000,000, interest 1.5%: SEK 40,500
SEK 8,000,000, interest rate 2.0%: SEK 48,000
SEK 8,000,000, interest 1.5%: SEK 36,000
SEK 7,000,000, interest rate 2.0%: SEK 42,000
SEK 7,000,000, interest 1.5%: SEK 31,500
SEK 6,000,000, interest rate 2.0%: SEK 36,000
SEK 6,000,000, interest 1.5%: SEK 27,000
SEK 5,000,000, interest rate 2.0%: SEK 30,000
SEK 5,000,000, interest 1.5%: SEK 22,500
SEK 4,000,000, interest rate 2.0%: SEK 24,000
SEK 4,000,000, interest 1.5%: SEK 18,000
SEK 3,000,000, interest rate 2.0%: SEK 18,000
SEK 3,000,000, interest rate 1.5%: SEK 13,500
SEK 2,500,000, interest rate 2.0%: SEK 15,000
SEK 2,500,000, interest rate 1.5%: SEK 11,250
SEK 2,000,000, interest rate 2.0%: SEK 12,000
SEK 2,000,000, interest 1.5%: SEK 9,000
SEK 1,500,000, interest rate 2.0%: SEK 6,750
SEK 1,500,000, interest rate 1.5%: SEK 4,500
SEK 1,000,000, interest rate 2.0%: SEK 6,000
SEK 1,000,000, interest rate 1.5%: SEK 4,500
SEK 750,000, interest rate 2.0%: SEK 4,500
SEK 750,000, interest 1.5%: SEK 3.375
SEK 500,000, interest rate 2.0%: SEK 3,000
SEK 500,000, interest rate 1.5%: SEK 2,250

 

Here you can learn more:

Loan

 

How to make interest deductions and how to declare interest on private loans and mortgages
What should one have for interest on a private loan , read more about loans with low interest rates
Compare loans so you know you have the lowest interest rate on your private loan.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

Close