The combined amount that Icelandic home owners owe in overdraft increased by ISK 8.3 billion (USD 128 million, EUR 86 million) last year and now counts ISK 75.7 billion (USD 1.2 billion, EUR 780 million).
Overdrafts are the most expensive loans available; interest rates of such loans currently stand at 25 percent. Certain customers, however, like student, are offered better terms, Morgunbladid reports.
If the total overdraft debt is divided between every Icelander, 18 and older, everyone owes ISK 327,000 (USD 5,000, EUR 3,4000) in overdraft and has to pay almost ISK 82,000 (USD 1,300, EUR 848) per year in interest rates.
In December 2007, Icelanders paid ISK 1.2 billion (USD 18 million, EUR 12 million) in interest rates from overdrafts alone.
The total debt of home owners in Iceland currently amounts to ISK 838.2 billion (USD 13.0 billion, EUR 8.7 billion), up by ISK 130 billion (USD 2.0 billion, EUR 1.3 billion) from 2006.