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PROPERTY

Hugh Grant plans to tear down new Swedish home

What's the first thing you do after snapping up a luxury six million kronor ($704,000) villa in Sweden, with sea views, two kitchens and a fireplace? If you're Hugh Grant: you raze it to the ground.

Hugh Grant plans to tear down new Swedish home
Anna Eberstein and Hugh Grant at the 2014 Swedish Open. Photo: Björn Larsson Rosvall/TT

The Local was last week able to reveal official paperwork confirming that the Hollywood actor had bought the 122-square metre home in the coastal town of Torekov, together with Swedish TV producer and mother of his son Anna Eberstein.

But on Tuesday the Expressen tabloid reported that Grant has now handed in an application to the local authority in Båstad municipality to have the property completely demolished.

“I don't know if he's going to tear it down, but he has all opportunities in the world. He can afford to do what the heck he wants, six million [kronor] to him is probably like buying a couple of litres of milk,” Martin Ploman, whose family had owned the property for 50 years before selling it to the actor on October 15th, told the newspaper.

“The only thing I hope is that he likes it and that it will turn out well,” he added.

Grant had a son with Eberstein, the daughter of Swedish Social Democrat politician Susanne Eberstein, in 2012. It was reported last month that the pair are expecting a second child.

“I don't think he is going to come here to show off and be noticed by building some kind of huge bungalow with swimming pools and the like. But they are expecting their second child and it's a big garden where you can put up swings and stuff,” said Ploman.

READ ALSO: Five questions before buying a home in Sweden


Documents shown to The Local last week confirming the sale.

Torekov is a seaside resort close to Båstad, one of the glitziest spots in Sweden, which hosts the Swedish Open tennis tournament each year. But although the town is already home to a number of celebrities, local residents seem less than impressed about news of the purchase.

“He has been here many times before, over several years. So it's not a big deal that he has bought a house here now,” Anette Bohlin, 58, told The Local last week, revealing that Grant “bought cinnamon buns at the local cafe here every day last summer”.

Other well known residents are understood to include Swedish singer Meja, who had a global hit in 1998 with the song 'All 'bout the Money', Swedish businessman Bertil Hult, and national football hero Henrik Larsson.

Hugh Grant already has two other children from his relationship with Tinglan Hong. His daughter Tabitha was born in 2011, while Felix was born a year later.

The actor is not the first celebrity to demonstrate his love for Sweden in recent months.

In May, US rapper Wyclef Jean revealed that he fell in love with Sandviken in central Sweden after a gig there and was planning a move to the town in the next couple of years.

For members

PROPERTY

Can I get a Swedish mortgage without permanent residency?

The Swedish rental market is notoriously difficult for immigrants to break into, so many consider buying a property instead. But can you get a Swedish mortgage without a permanent residence permit?

Can I get a Swedish mortgage without permanent residency?

The answer, as with many of these questions, is ‘it depends’.

Do I need permanent residency?

There is no legal requirement that mortgage holders in Sweden must be permanent residents, citizens, or even registered in the country. On the other hand, there is no legal requirement for banks to accept mortgage applications from just anyone either, which leaves them perfectly within their rights to deny applications to temporary residence permit holders if they deem them to be too big of a risk.

Why might a bank say I need permanent residency to take out a mortgage?

One reason your bank could require you to have permanent residency is that they deem it too risky to lend to someone who they think might not be staying in Sweden for long enough to pay off their mortgage.

Banks want to be reassured that they will get their money back if they lend to you, and if you don’t have permanent residency in Sweden, there’s always a chance your temporary residence permit will run out and a renewal might not be approved, leaving you forced to leave Sweden before you’ve had time to pay off your loan.

Similarly, banks which may once have been more willing to approve mortgage applications to more ‘risky’ applicants may be more wary in the current climate, where house prices are dropping and interest rates are going up.

Ultimately, a temporary residence permit is one of many risk factors for a bank – if you’re forced to (or choose to) leave Sweden after a short while and your property has lost value, that could leave you in a position of negative equity – where you owe the bank money after you sell your property.

Is there anything I can do to make sure I don’t get my mortgage application rejected?

First off, mortgage applications are often stressful – you’ve successfully bid on a property and you’ve set a date for signing the contract, so you want to get your paperwork in order and make sure you can finance the property quickly.

Additionally, banks are slow, so the last thing you want is to wait days just for your bank to turn you down for a mortgage.

The best way to ensure you get a mortgage approved in time is to keep your options open and apply to multiple banks, as different banks weigh different risk factors more highly than others.

Danske Bank, for example, appear to reject mortgage applications for people without permanent residency, as I was told when my mortgage application with them was rejected.

Be aware though, that every time a bank takes out a credit check on you, this affects your credit rating. A good way to get around this is to apply for a mortgage via services like Ordna Bolån and Lånekoll, who take out a single credit check for you and use that to apply to multiple banks on your behalf.

Another way to increase the chance of your application being approved is to borrow less money, if you can. Just because your bank has given you a maximum budget you can buy for in your lånelöfte or lender’s note, doesn’t mean you have to buy for that much, and the less money you apply to borrow, the more likely the bank is to approve your application.

There’s another benefit to this, too – it lowers your belåningsgrad, or the percentage of the property’s value you’re financing with your mortgage. If you loan more than 70 percent of a property’s value, you have to amortise (pay back) 2 percent of the value of your mortgage per year. If you loan between 50 and 69 percent, you must amortise 1 percent of your mortgage per year, and if you loan under 50 percent of the property’s value, you don’t have to amortise anything (although it could still be a good idea to do so, if you can).

Additionally, in Sweden there is something called a skuldkvot or “debt quota”, meaning if the amount you’re loaning is more than 4.5 times your yearly salary (or the yearly salary of you and your co-applicant, if you’re applying with someone else), you need to amortise an additional 1 percent per year, on top of anything you have to amortise based on the percentage of the property’s value you’re borrowing from the bank.

This means, if you can put in enough cash to reduce your belåningsgrad from above 70 percent to under 50 percent, as well as loaning less than 4.5 times your yearly salary, you can cut down your amortising from 3 percent to nothing.

This will all be factored in by the bank when deciding if you can afford to pay your mortgage, too, so cutting down your monthly costs will make it more likely for them to approve you.

Finally, have a look at the driftkostnad (running costs) for a house, or the avgift (monthly fee) if buying an apartment or terraced house in a bostadsrättsförening (BRF) housing co-operative. The lower this is, the lower your monthly cost, and the more likely your bank is to determine that your monthly costs aren’t too high in relation to your income.

Are there any other reasons foreigners might be rejected from buying property in Sweden?

Many – but not all – banks require mortgage applicants to be registered in the Swedish population register (this means you need to have a personnummer) and have your salary paid out in Swedish kronor.

If you earn money in another currency, this doesn’t necessarily mean you can’t get a mortgage, but it could mean that you can’t loan as much as you could if you were paid in Swedish kronor.

This is due to the fact that banks will always be conservative in their calculations when deciding if you can afford to pay back a loan (especially so in the current climate), and will calculate your budget based on how much your income would be worth if the currency you are paid in became much weaker than the krona, despite the fact it could be much stronger at the time you apply.

Some may require that you have BankID in order to apply for a mortgage, which in practice also means you need to have a personnummer and a Swedish bank account.

These criteria aren’t usually published on the banks’ websites and could change now that the market is becoming less stable as lenders seek to reduce their risk, so call your bank in advance to ask if you want to be sure. 

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