Act on Real Estate Credit Companies

Act on Real Estate Credit Companies 1)

Hereby is promulgated the Act on Real Estate Credit Companies, cf. Act No. 285 of 1 March 2023, with the amendments resulting from Section 8 of Act No. 1546 of 12 December 2023, Section 13 of Act No. 1666 of 30 December 2024, and Section 11 of Act No. 712 of 20 June 2025.

The amendments resulting from Section 5 of Act No. 1322 of 20 November 2025 on amendment of the Act on Credit Agreements, the Act on Marketing, the Act on Consumer Loan Businesses, and various other laws (Implementation of the revised Mortgage Credit Directive) are not incorporated into this consolidated act, as these enter into force on 20 November 2026, cf. Section 6, subsection 1, of Act No. 1322 of 20 November 2025.

Chapter 1 Scope of Application and Definitions

Section 1. This Act applies to real estate credit companies.

Subsection 2. By real estate credit companies are meant companies that carry out at least one of the following activities:

1. Commercial purchase or sale of mortgage deeds in real estate, including commercial sale of mortgage deeds in their own real estate.
2. Commercial provision of mortgage credit agreements.

Section 1a. In this Act, the following definitions apply:

1. Mortgage credit agreement: An agreement whereby a creditor grants or promises to grant a consumer credit secured by a mortgage or by another comparable security on, or another right related to, immovable property used for residential purposes, or credit agreements which serve the purpose of acquiring or retaining ownership rights in land or in existing or projected buildings.
2. Consumer: A natural person who, in transactions covered by this Act, is acting for purposes which are outside his trade, business, or profession.
3. Mortgage-like loan: A loan which at the time of borrowing has an agreed maturity of more than 10 years and a principal amount of at least 100,000 DKK. Furthermore, the loan must be secured by a mortgaged owner-occupied dwelling or holiday home located in Denmark, and the security must not be provided in the form of a registered mortgage deed or a loss-free deed. The loan must also at the time of borrowing fall within the loan limits following from Section 5, or be granted pursuant to Section 7 of the Act on Mortgage Loans and Mortgage Bonds, etc.

Chapter 2 Requirements for Real Estate Credit Companies

Section 2. Activities under Section 1, subsection 2, may only be carried out by a company that, in accordance with the rules in this Chapter, has permission to operate as a real estate credit company, cf. however subsection 2.

Subsection 2. Subsection 1 and Sections 3-7 and 9-11 do not apply to credit institutions, mortgage credit institutions, fund brokerage companies, investment management companies, and insurance companies.

Subsection 3. Real estate credit companies that have obtained permission in accordance with the rules in this Chapter must use the designation "real estate credit company" in their name. Terms such as registered, approved, authorized, or similar must not be added to the name. Other companies must not use names or designations for their business that are likely to create the impression that they are real estate credit companies.

Section 3. The Danish Financial Supervisory Authority grants a company permission to carry out business as a real estate credit company upon application, when:

1. the company is operated as a public limited company or a private limited company,
2. the company has a board of directors and a management board, and the members thereof meet the conditions in Section 4,
3. the person in the company responsible for trading in mortgage deeds, when the company carries out business covered by Section 1, subsection 2, no. 1, and the person responsible for credit granting, when the company carries out business covered by Section 1, subsection 2, no. 2, meet the conditions in Section 5,
4. the owners of qualifying holdings in the company meet the principles in Sections 61-62 regarding ownership conditions in the Act on Financial Business, and
5. the company has a business procedure for creditworthiness assessment, cf. the Act on Credit Agreements.

Subsection 2. A real estate credit company that trades in mortgage deeds in real estate with consumers must, in addition to meeting the requirements in subsection 1, document that a special account has been established into which the agreed proceeds shall be deposited, and that the company has established security for these funds, cf. subsection 6.

Subsection 3. The requirements in subsection 1 must be met upon submission of the application, and at all times after the permission has been granted, cf. however Section 24, subsections 2 and 3.

Subsection 4. An application for permission pursuant to subsection 1 must contain the information necessary for the Danish Financial Supervisory Authority to assess whether the conditions in subsection 1 are met. The application must additionally contain information on:

1. the company form and the company's structure and organization, including the company's setup and planned operations, as well as business procedures for fulfilling the disclosure requirements in Section 8,
2. the names of the company's shareholders and the shareholders' share of the company's capital or voting rights, and
3. which of the activities mentioned in Section 1 the company intends to carry out, including whether the company trades with consumers.

Subsection 5. An application for permission pursuant to subsection 1 must be submitted via the Danish Financial Supervisory Authority's self-service solution accompanied by the necessary information, cf. subsection 3. If an application exceptionally cannot be submitted via the self-service solution, the application accompanied by the necessary information must be submitted electronically to the Danish Financial Supervisory Authority using the Authority's notification form.

Subsection 6. The Danish Financial Supervisory Authority may set detailed rules regarding the scope, nature, and temporal extent of the security mentioned in subsection 2.

Subsection 7. The real estate credit company must annually submit a declaration from an approved auditor regarding the security mentioned in subsection 2 to the Danish Financial Supervisory Authority.

Subsection 8. The Danish Financial Supervisory Authority makes a decision on permission no later than 6 months after the Danish Financial Supervisory Authority has received the information necessary to process the application.

Section 4. A member of the board of directors and the management board of a real estate credit company must have sufficient experience to perform their duties or hold their position in the respective company.

Subsection 2. A member of the board of directors or the management board must fulfill the following:

1. Must not have been or be subject to criminal liability for violation of the Penal Code, this Act, other financial legislation, or other relevant legislation, if the violation entails a risk that the person cannot perform their duties or hold their position in a reliable manner.
2. Must not have declared payment suspension, submitted a request for composition agreement, bankruptcy, or debt restructuring, or be in payment suspension, under bankruptcy proceedings, debt restructuring, or composition agreement.
3. Must not have exhibited or exhibit behavior that gives reason to assume that the person will not perform the duties or hold the position in a proper manner.

Subsection 3. In assessing whether a member of the board of directors or the management board, as well as the person responsible for mortgage deed trading or the person responsible for credit granting in a real estate credit company, meets the requirements in subsection 2, nos. 1 and 3, regard must be paid to the need to maintain confidence in the financial sector.

Subsection 4. When a person assumes a position as a board member or a position as a director in a real estate credit company, the Danish Financial Supervisory Authority ensures that the person meets the suitability and integrity requirements in subsections 1 and 2. The Danish Financial Supervisory Authority makes a decision on whether the person can hold the position or office in the respective business.

Subsection 5. If the Danish Financial Supervisory Authority assesses that the person does not meet the requirements in subsection 2, the duration of the decision must be stated in the decision.

Subsection 6. The Danish Financial Supervisory Authority may in special cases, where the Danish Financial Supervisory Authority assesses that a person does not have sufficient professional prerequisites or experience relative to the position as a member of the management board that the person is assessed for, make a decision that the person may hold the position under specifically determined conditions.

Subsection 7. Members of the board of directors and the management board, as well as the person responsible for mortgage deed trading and the person responsible for credit granting in a real estate credit company, must notify the Danish Financial Supervisory Authority of circumstances as mentioned in subsections 1 and 2 in connection with their entry into the management of the financial business, and of circumstances as mentioned in subsection 2, if the circumstances subsequently change.

Section 5. The real estate credit company carrying out activities covered by Section 1, subsection 2, no. 1, must appoint a person who is responsible for trading in mortgage deeds. If the company carries out activities covered by Section 1, subsection 2, no. 2, it must appoint a person who is responsible for credit granting. The respective responsible person for trading in mortgage deeds and the responsible person for credit granting must have at least 3 years of practical experience with respectively mortgage deed trading and credit granting, cf. however subsection 3.

Subsection 2. Section 4, subsection 2, nos. 1 and 3, and subsections 4, 5, and 7, apply mutatis mutandis to the responsible person for trading in mortgage deeds and the responsible person for credit granting.

Subsection 3. The Danish Financial Supervisory Authority may upon application permit that the person responsible for trading in mortgage deeds and the person responsible for credit granting do not meet the condition in subsection 1.

Section 5a. A real estate credit company must have a system whereby employees of the real estate credit company can report violations or potential violations of financial regulation committed by the real estate credit company, including by employees or members of the board of directors of the real estate credit company, via a special, independent, and autonomous channel. Reports to the system must be able to be made anonymously. The real estate credit company must follow up on reports to the system and be able to document in writing how the company has followed up on the reports. The Act on Protection of Whistleblowers applies to the system in the first sentence.

Subsection 2. The system in subsection 1 may be established via collective agreement.

Subsection 3. Subsection 1 applies only to real estate credit companies that employ more than five employees. The system mentioned in subsections 1 and 2 must be established no later than 3 months after the company has hired the sixth employee.

Subsection 4. The Danish Financial Supervisory Authority may in special cases, where the Danish Financial Supervisory Authority assesses that it would be pointless to establish a system, exempt from the requirement in subsection 1.

Section 5b. A real estate credit company must not subject employees or former employees to unfavorable treatment or unfavorable consequences as a result of the employee or former employee having reported the real estate credit company's violation or potential violation of financial regulation to the Danish Financial Supervisory Authority or to a system in the company. The same applies when determining, allocating, and paying variable remuneration to employees or former employees.

Subsection 2. Employees or former employees whose rights have been violated by a breach of subsection 1 may be awarded compensation in accordance with the principles of the Act on Equal Treatment of Men and Women with regard to Employment, etc. The compensation is determined with regard to the employee's or former employee's period of employment and the circumstances of the case otherwise.

Subsection 3. Subsections 1 and 2 may not be derogated from by agreement to the detriment of the employee or former employee.

Section 5c. If an employee or a former employee and a real estate credit company enter into an agreement containing a confidentiality clause, it must appear from the agreement that the employee or former employee is not barred from reporting information about violations or potential violations of financial regulation to public authorities.

Subsection 2. Notwithstanding subsection 1, the employee or former employee is not barred from reporting information about violations or potential violations of financial regulation to public authorities, even if such a prohibition is included in an agreement between the employee or former employee and the real estate credit company. The same applies to reports to systems pursuant to Section 5a.

Section 6. The Danish Financial Supervisory Authority establishes a register of real estate credit companies that have permission pursuant to Section 3. When the Danish Financial Supervisory Authority has granted a real estate credit company permission pursuant to Section 3, subsection 1, the company and the person responsible for trading in mortgage deeds or credit granting are registered in the Danish Financial Supervisory Authority's register. The register is publicly accessible.

Section 7. A real estate credit company may carry out other business than activities covered by Section 1, subsection 2.

Subsection 2. The Danish Financial Supervisory Authority may make a decision that a real estate credit company may not carry out a specific form of business, if this business is not compatible with a reliable carrying out of activities covered by Section 1, subsection 2.

Chapter 3 Information Requirements and Good Conduct, etc.

Section 8. In the commercial sale of mortgage deeds, information must be given to the buyer about the mortgage deed and the circumstances under which it was issued before the agreement is concluded, so that the buyer can assess the real value of the mortgage deed.

Subsection 2. The Danish Financial Supervisory Authority sets detailed rules regarding the information that must be given to the buyer pursuant to subsection 1, including information on whether the mortgage deed is newly issued, what type of real estate the mortgage deed provides security in, and the priority status of the mortgage deed.

Section 8a. Real estate credit companies must conduct business in accordance with fair business practices and good practice within the business area.

Subsection 2. The Minister for Business Affairs sets detailed rules regarding fair business practices and good practice for real estate credit companies.

Subsection 3. The Danish Financial Supervisory Authority may, after consultation with representatives of consumers and the relevant financial industry organizations, draw up and publish guidelines for fair business practices and good practice in specifically indicated areas, which may be considered significant, particularly from the perspective of consumers.

Subsection 4. The Minister for Business Affairs sets detailed rules regarding competence requirements for employees in real estate credit companies.

Subsection 5. The Minister for Business Affairs sets detailed rules regarding price and risk information for mortgage credit.

Subsection 6. The Danish Financial Supervisory Authority may set detailed rules regarding the measures that a real estate credit company must take to have effective procedures for the development and distribution of products.

Subsection 7. The Minister for Business Affairs sets detailed rules regarding the obligation of real estate credit companies to issue a standardized key information document to consumers when making offers for mortgage-like loans.

Section 8b. Real estate credit companies must ensure that remuneration of the company's employees is not in conflict with the company's obligations under Section 8a, subsections 1 and 2.

Subsection 2. Real estate credit companies must ensure that the company draws up a remuneration policy that is consistent with and promotes sound and effective risk management. The remuneration policy must be consistent with the company's business strategy, objectives, values, and long-term interests. The remuneration policy must not encourage risk-taking that is contrary to the company's risk profile.

Subsection 3. The remuneration policy must contain measures to avoid conflicts of interest and ensure that the remuneration of employees is not dependent on the number or proportion of approved mortgage credit applications or other sales targets.

Subsection 4. For persons in employment relationships covered by a collective agreement, subsections 1 and 3 apply only to remuneration agreements if the remuneration agreements are not set in the collective agreement.

Section 8c. A real estate credit company must not in ongoing customer relationships change interest rates, fees, or other remuneration for mortgage-like loans to the detriment of the consumer without prior notice of 6 months.

Subsection 2. A notice pursuant to subsection 1 must contain a justification for the change. The justification must state:

1. the circumstances that triggered the change, and a reference to the parts of the contractual basis that contain the grounds for implementing the change, and
2. information on the most significant circumstances that have had an impact on the extent of the change, and the estimated share of these circumstances in the total increase.

Subsection 3. A notice pursuant to subsection 1 must additionally contain the following information:

1. The market value of the consumer's loan. If the rate is not fixed, the real estate credit company must inform the consumer of this and how the consumer can obtain information about the current rate.
2. Information that the consumer has the possibility to repay the loan and refinance it into another loan in the same real estate credit company or with another creditor, and under which conditions the consumer can repay the loan.
3. Information that other creditors can be found on price portals operated by private providers and on the price portal for mortgage loans.

Subsection 4. In the event of changes to interest rates, significant changes to other remuneration, or the charging of a new remuneration, the notice must be given to the consumer on paper or other durable medium. The notice must have reached the consumer no later than 6 months before the change enters into force.

Subsection 5. Subsections 1, 3, and 4 do not apply to changes based on external circumstances over which the real estate credit company has no influence.

Subsection 6. The provision does not apply to pre-agreed changes in interest rates, interest caps, or interest floors, when these changes according to the agreement can only be implemented with at least 3 years between them.

Section 8d. A real estate credit company may only enforce a change in interest rates, fees, or other remuneration if the real estate credit company has observed Section 8c, subsections 1, 2, and 4, cf. however subsection 2 and Section 8c, subsection 5.

Subsection 2. Subsection 1 does not apply to insignificant increases in fees and other remuneration other than interest.

Section 8e. If a real estate credit company has notified a consumer of an increase in an interest supplement, cf. Section 8c, subsection 1, and the consumer has terminated the relevant mortgage-like loan within 6 months from the day the notice reached the consumer, the real estate credit company must not charge fees in connection with the repayment of the relevant mortgage-like loan. The real estate credit company may, however, charge half of the fees that are charged in connection with a bond transaction for the purpose of repaying the mortgage-like loan.

Subsection 2. If a real estate credit company grants a consumer a mortgage-like loan for the purpose of repaying a mortgage loan or mortgage-like loan in cases where the consumer has terminated the relevant loan as a result of a notified increase in contribution or interest supplement within 6 months from the day the notice reached the consumer, the receiving real estate credit company may only charge half of the fees that are charged in connection with a bond transaction for the purpose of repaying the terminated mortgage loan or mortgage-like loan.

Subsection 3. The provision does not apply to pre-agreed changes in interest rates, interest caps, or interest floors, when these changes according to the agreement can only be implemented with at least 3 years between them.

Chapter 4 Withdrawal and Expiry of Permissions

Section 9. The Danish Financial Supervisory Authority withdraws a real estate credit company's permission if:

1. the company requests it,
2. the company is guilty of gross or repeated violation of the provisions of this Act or rules issued pursuant to the Act,
3. the company no longer meets the conditions in Section 3, subsection 2, Section 24, subsection 2, and Section 4,
4. the company no longer has employed a person who is responsible for trading in mortgage deeds and who meets the requirements in Section 5,
5. no business covered by the Act is carried out for a period of more than 12 months,
6. the Danish Financial Supervisory Authority has ordered the real estate credit company to dismiss the director or the person responsible for mortgage deed trading, and the order has not been complied with within the specified deadline, cf. Section 14, subsections 1 and 3,
7. the Danish Financial Supervisory Authority has ordered a board member to resign, and the order has not been complied with, cf. Section 14, subsections 2 and 3,
8. the company does not have a person employed who is responsible for credit granting when the company carries out activities covered by Section 1, subsection 2, no. 2, and who meets the requirements in Section 5, or
9. the Danish Financial Supervisory Authority has ordered the real estate credit company to dismiss the director or the person responsible for credit granting when the company carries out activities covered by Section 1, subsection 2, no. 2, and the order has not been complied with within the specified deadline, cf. Section 14, subsections 1 and 3.

Section 10. A real estate credit company's permission expires if the company is declared bankrupt or ceases in another manner.

Section 11. If the permission to a real estate credit company is withdrawn or expires, the company's activities under Section 1, subsection 2, must cease, cf. however subsections 2 and 3.

Subsection 2. If a real estate credit company's permission is withdrawn or expires, the real estate credit company may, however, dispose of the inventory of mortgage deeds and mortgage credit agreements that the company has at the time of withdrawal or expiry of the permission. The Danish Financial Supervisory Authority may order the company to prepare an inventory at the time of withdrawal or expiry of the permission regarding the inventory of respectively mortgage deeds and mortgage credit agreements.

Subsection 3. Upon withdrawal or expiry of a permission to a real estate credit company, the respective company and the person responsible for trading in mortgage deeds, and the person responsible for credit granting, are deleted from the Danish Financial Supervisory Authority's register of real estate credit companies.

Chapter 5 Supervision, Complaints, and Penal Provisions

Supervision

Section 12. The Danish Financial Supervisory Authority ensures compliance with this Act and rules issued pursuant to the Act. The supervision is based on a risk assessment. The Danish Financial Supervisory Authority does not ensure compliance with Section 5b.

Subsection 2. The Consumer Ombudsman may bring a case regarding actions that contradict fair business practices and good practice, cf. Section 8a, subsections 1 and 2, and Sections 8c-8e, including cases regarding injunctions, orders, compensation, and recovery of unlawfully charged amounts. The Consumer Ombudsman may also handle cases regarding violation of penal provisions in rules issued pursuant to Section 8a, subsection 5 of this Act. Section 24, Section 25, subsection 2, Section 28, subsection 1, Section 32, subsection 1, Section 33, and Section 34 of the Marketing Act apply mutatis mutandis to cases that the Consumer Ombudsman wishes to bring pursuant to this provision. The Consumer Ombudsman may be appointed as class representative in a class action, cf. Chapter 23a of the Administration of Justice Act.

Subsection 3. The Danish Financial Supervisory Authority notifies the Consumer Ombudsman if the Danish Financial Supervisory Authority becomes aware that customers of a real estate credit company may have suffered loss as a result of the real estate credit company having violated Section 8a, subsection 1, or rules issued pursuant to Section 8a, subsection 2.

Subsection 4. The Consumer Ombudsman has access to all information in the Danish Financial Supervisory Authority's cases covered by subsection 3, regardless of Sections 13 and 13a.

Subsection 5. The Danish Financial Supervisory Authority may at any time, upon proper identification and without a court order, gain access to premises belonging to companies covered by this Act for the purpose of obtaining information.

Subsection 6. The Danish Financial Supervisory Authority's board participates in the supervision pursuant to subsection 1 with the competence that the board is granted pursuant to Section 345 of the Act on Financial Business.

Subsection 7. The Danish Financial Supervisory Authority may issue orders to rectify circumstances that are in conflict with this Act, cf. Section 3, subsections 2 and 7, Section 7, subsection 2, Section 8, subsection 1, Section 8a, and Section 11, subsection 1.

Section 13. Employees of the Danish Financial Supervisory Authority are obliged under the Penal Code Sections 152-152e to keep confidential information that they become aware of.

1. The Act contains provisions that implement parts of Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property and amending Directive 2008/48/EC and Directive 2013/36/EU and Regulation (EU) No 1093/2010, Official Journal of the European Union 2014, No L 60, page 34.

Act Gazette A 2025 Published on 9 December 2025 18 November 2025. No. 1539. Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, file no. 25-006936 CQ003385