Green home loan

The mortgage loan agreement shows the EURIBOR rate as of the date of drafting the agreement. Upon disbursement of the loan, the EURIBOR rate effective at the date of signing the agreement is applied to the agreement. Therefore, if the loan agreement is not signed the same day it has been drafted, the EURIBOR rate actually applied to the loan might differ from the initial rate set out in the agreement (i.e. if EURIBOR increases, the rate can be higher, if EURIBOR decreases, the rate can be lower). You can find the EURIBOR rate actually applied to your loan from our online banking or mobile app.

In annuity schedules, the loan payment is the same every month, if the interest rate and its calculation periods remain unchanged. At the beginning of the loan agreement, the interest portion of the monthly payment is larger, and the principal portion is smaller. In time, their proportions change - the interest portion decreases, while the principal portion increases. 

In the sample schedule, where the length of each month is normally calculated to be 30.42 days (365 days divided by 12 months), the annuity schedule would look like this: 

In the example, it is easy to see how the amount of the principal part increases every month and the interest part decreases every month. 

There is not an equal number of days in each month, which means that real loan schedules will not change exactly according to the sample. In their loan schedule, the customer pays interest according to the actual number of days between two monthly payments. If the number of days between monthly payments is different, then the amount of interest in the next payment may not be lower than the previous one. 

Let's imagine a situation where a customer was issued a loan amount on March 20, 2023, and he chose the 20th as his monthly payment date. 
The beginning of a realistic loan schedule would look like this: 

What does an annuity schedule that uses the actual number of days per month show? 

• In the case of payment number 2, May 20th is a Saturday, therefore the payment will be moved to the following working day - May 22nd. The interest portion is higher in this payment compared to the previous month, because the number of days between two monthly payments is greater - the customer pays interest for 32 days, not 31 days (as for the first payment). 
• The same situation occurs when comparing payments number 4 and 5. 
• If the interest portion of the monthly payment increases (interest is paid for a longer period), it also changes the amount of the principal. In annuity schedules, the most important part is to keep the monthly payment amounts equal, and therefore, as the interest portion increases, the amount of the principal portion in the payment decreases. 

Here is an example where the interest and principal payments over six months are added together:

If you look at your loan schedule over longer periods, you can see that the actual schedule also moves according to the principle of the annuity schedule - over time, the interest portion decreases and the principal portion increases. 

• Euribor (European Interbank Offered Rate) is the average interest rate for pan-European interbank lending, which changes daily. The home loan interest rate is linked to the personal margin and the Euribor and is therefore variable. Citadele offers Euribor fixing for 6 months. If Euribor has increased during this time, the loan payment will also increase.
• Due to the changing interest rate and monthly loan payments, it is important to assess whether it is still possible to successfully pay the loan with a higher monthly payment. For example, for a loan amount of 100 000 EUR taken for a 30-year period, a 1% increase in interest will increase the monthly payments by about 50 EUR. The bigger the loan amount, the greater the effect of the interest rate change on the monthly payment.
• If you have already taken or are planning to take a home loan, you can calculate the effect of the interest rate change on your monthly payment in our loan calculator.

Euribor index

To find out the loan amount available to you, go to the Citadele website Loans → Home loan.
Fill in the loan calculator and find out how much you can borrow.

If you want to fill in a mortgage loan application, proceed by selecting the Apply online button and log in with one of the authorization devices.

Fill in the required fields in the application, provide information about yourself, existing credit commitments. If the terms and conditions of using the Kredex guarantee apply to you, the relationship manager will take this into account when making an indicative offer.

After submitting the application, you will see on the screen that the application has been created, as well as you will receive an informative e-mail about it.

1. The customer fills in the application
2. An indicative offer is prepared
3. Additional requested documents are submitted (e.g., account statements, real estate appraisal)
4. Decision of granting a loan
5. The loan agreement and other documents are signed in the bank
6. The documents shall be signed by a notary and submitted to the Land Register
7. After the submission of the notary agreement and all other required documents to the bank, the loan amount is paid out

EURIBOR is the average interbank EUR lending rate for a set period of time, and is overseen by the EMMI (European Money Markets Institute) or other internationally-recognised organisations. The European Money Markets Institute's EURIBOR index (rate) is the rate at which banks borrow money in the interbank market within European Union countries.

The frequency and date of EURIBOR rate changes is set out in your loan agreement. For example, if you have a leasing agreement with Citadele Leasing, your repayment amounts will change every 3, 6 or 12 months depending on the period set out in your agreement.

Bearing in mind that EURIBOR is the average interbank EUR lending rate for a set period of time, Citadele has no say in setting EURIBOR rates. Since 2015, the EURIBOR rate has been negative, but bearing in mind the growing pace of inflation, the European Central Bank (ECB) Council has decided to gradually raise the EURIBOR rate, and it has now increased to above 0.

You can see the current and historic EURIBOR rate index on the: https://www.emmi-benchmarks.eu/benchmarks/euribor/.