Order on Good Conduct in Residential Credit

Order on Good Conduct in Residential Credit 1)

Pursuant to Section 43, paragraphs 2, 3, and 7, and Section 373, paragraph 4, of the Act on Financial Business, cf. Act Consolidation No. 1390 of 18 November 2025, Section 7, paragraph 2, and Section 26, paragraph 4, of the Act on Investment Advisors and Mortgage Intermediaries, cf. Act Consolidation No. 1095 of 21 October 2024, as amended by Act No. 1668 of 30 December 2024, and Section 8a, paragraphs 2 and 7, and Section 22, paragraph 4, of the Act on Real Estate Credit Companies, cf. Act Consolidation No. 285 of 1 March 2023, it is hereby prescribed:

Chapter 1 Scope and Definitions

Section 1. This Order applies to the following activities that provide or intermediates residential credit agreements:

1. Danish financial businesses, cf. Section 5, paragraph 1, no. 1, of the Act on Financial Business, and foreign financial businesses operating in this country, including through branch establishment or cross-border provision of services.
2. Danish mortgage intermediaries, cf. Section 2, no. 2, of the Act on Investment Advisors and Mortgage Intermediaries, and foreign companies operating as mortgage intermediaries in this country, including through branch establishment.
3. Real estate credit companies that professionally provide residential credit agreements, cf. Section 1, paragraph 2, no. 2, of the Act on Real Estate Credit Companies.

Section 2. In this Order, the following terms are defined:

1. Residential credit agreement: a) A credit agreement whereby a creditor grants or undertakes to grant a borrower credit secured by a mortgage or other security interest in immovable property used for residential purposes, or other rights attached to immovable property used for residential purposes. b) A credit agreement whereby a creditor grants or undertakes to grant a borrower credit for the purpose of acquiring or retaining ownership rights to land plots or to existing or planned buildings.
2. Consumer: A natural person who, in transactions covered by this Order, does not act for purposes related to their trade, business, craft, or profession.
3. Housing cooperative: A housing community that is a housing cooperative, cf. the Act on Housing Cooperatives and Other Housing Communities.
4. Borrower: A consumer, cf. no. 2, and a housing cooperative, cf. no. 3.
5. Advice: Personal recommendations to a borrower regarding one or more transactions in connection with residential credit agreements, which are independent of the provision of the residential credit agreement and the activities provided by a mortgage intermediary, cf. no. 6.
6. Mortgage intermediary: A company that, as part of its professional main or ancillary activity, presents or offers residential credit agreements to borrowers, concludes such agreements with a borrower on behalf of a creditor, or assists a borrower with administration or other preparatory work prior to the conclusion of a residential credit agreement.
7. Mortgage lender: A company that, as part of its professional activity, provides residential credit agreements.
8. Tied mortgage intermediary: A mortgage intermediary that acts on behalf of and under the full and unconditional responsibility of one or more mortgage lenders who do not represent a majority of the market.
9. Package sale: An offer or sale of a residential credit agreement in a package with other separate financial products or services, where the residential credit agreement is also made available individually to the borrower, but not necessarily on the same terms as when included in a package with ancillary services.
10. Cross-selling: An offer or sale of a residential credit agreement in a package with other separate financial products or services, where the residential credit agreement is not made available individually to the borrower.
11. Residential credit agreement in foreign currency: a) A residential credit agreement where the credit is issued in and must be repaid in a currency other than the one in which the borrower primarily receives income or holds assets, and from which the residential credit agreement is to be repaid. b) A residential credit agreement issued in a currency other than the currency applicable in the country of the European Union or the country with which the Union has concluded an agreement in the financial field, in which the borrower is resident at the time of concluding the residential credit agreement.
12. Durable medium: A device that enables the borrower to store information addressed personally to the borrower in a way that allows for future search for a period adapted to the purpose of the information, and enables the unaltered reproduction of the stored information.
13. Real estate credit-like loan: A loan that, at the time of borrowing, has an agreed term of more than 10 years and a principal of at least 100,000 DKK. Furthermore, the loan must be secured by a mortgage on an owner-occupied home, a holiday home, or a farm that can be mortgaged according to the rules for owner-occupied homes and holiday homes, located in Denmark, and the loan must, at the time of borrowing, fall within the loan limits resulting from Sections 5 and 7 of the Act on Real Estate Credit Loans and Real Estate Credit Bonds. For loans granted by a credit institution, the loan must be capable of serving as security for covered bonds or bonds that can be described as covered bonds, while for loans granted by a real estate credit company, there is a requirement that the security must not be granted in the form of a mortgage deed or a release deed.
14. Ancillary service: A service offered to the borrower in connection with the residential credit agreement.
15. Commercial practice: An act, omission, conduct, representation, or commercial communication, including advertising and marketing, carried out by a trader directly related to the promotion, sale, or supply of a product to borrowers.
16. Good business practice: The standard of special skill and care which a trader may reasonably be expected to exercise towards borrowers, which is commensurate with honest market practice and the general principle of good faith in the trader's field of activity. The concept covers the same as the concept of 'professional diligence' used in Directive 2005/29/EC on unfair business-to-consumer commercial practices.
17. Debtor interest rate: The interest rate expressed as a fixed or variable percentage rate applied on an annual basis to the utilized credit facilities.
18. Guidance: Comprehensive explanations.

Chapter 2 Good Conduct etc.

Good Conduct Section 3. A mortgage lender or a mortgage intermediary shall act honestly and fairly towards its customers, cf. however paragraph 2. Paragraph 2. If the commercial practice in question affects the borrower's economic interests, Sections 4-6 apply instead of paragraph 1. If the commercial practice in question simultaneously contradicts considerations not intended to safeguard the borrowers' economic interests, including considerations of taste and decency, safety and health, or other considerations, or if the commercial practice in question is regulated by contract law, paragraph 1 applies in addition to Sections 4-6.

Good Business Practice Section 4. A mortgage lender or a mortgage intermediary shall act honestly, transparently, and fairly and in accordance with good business practice.

Reasonable, Clear and Non-Misleading Marketing Section 5. Marketing of residential credit agreements shall be conducted in a reasonable, clear, and non-misleading manner. The marketing must not use wording that can create false expectations in the borrower regarding the availability of the mortgage or the costs associated with it.

Significant Distortion of Economic Behavior Section 6. It is a condition for acting contrary to Section 4 that the commercial practice in question significantly distorts or is expected to significantly distort the economic behavior of the average consumer, or if the commercial practice in question is directed at a specific group of borrowers, the average member of that group. Paragraph 2. A commercial practice that a mortgage lender or mortgage intermediary may reasonably assume only significantly distorts the economic behavior of a clearly identifiable group of borrowers who are particularly vulnerable to this practice or the product in question, including due to mental or physical infirmity, age, or credulity, is assessed with reference to the average member of that group.

Mortgage Lenders' Control of Tied Mortgage Intermediaries Section 7. A mortgage lender must ensure that a tied intermediary, which acts on behalf of and under the full and unconditional responsibility of one mortgage lender, complies with the provisions of this Order.

Chapter 3 Formal Requirements and Terms

Section 8. A mortgage lender or mortgage intermediary must conclude or confirm all material agreements with borrowers in paper format or on another durable medium. An agreement must contain a description of the parties' material rights and obligations as well as the financial services covered by the agreement. Paragraph 2. Terms included in the agreement may be stated by reference to separate documents, including a mortgage lender's or mortgage intermediary's general business terms.

Section 9. Terms in the residential credit agreement regarding changes to interest rates, fees, contributions, or other remuneration must be clearly highlighted in the agreement and must contain an indication of the circumstances that can trigger a change, and must not give the mortgage lender or mortgage intermediary arbitrary access to make changes. Paragraph 2. Changes to interest rates in residential credit agreements to the detriment of the borrower must not take place without prior notice, which must not be shorter than one month. The notice must contain a justification for the change. Changes to fees, contributions, or other remuneration for residential credit agreements cannot take place without notice of three months or more and must contain a justification for the change. The notice in the 1st and 3rd sentences does not apply to changes justified by external factors over which the mortgage lender or mortgage intermediary has no influence. In the case of changes to contributions and material changes to other remuneration or the charging of a new remuneration, the notice must be given to the borrower by individual communication before the change takes effect. If the borrower has the right to terminate the agreement, this must be stated in the notice as well as under which conditions the borrower can terminate the agreement. Paragraph 3. If a mortgage lender or mortgage intermediary terminates a residential credit agreement, the termination must be objectively justified and made in paper format or on another durable medium. Paragraph 4. Paragraph 2 does not apply to real estate credit loans and real estate credit-like loans granted to a consumer, cf. Section 53b of the Act on Financial Business.

Chapter 4 Information Requirements and Marketing

Information to be Provided Before Carrying Out Activities as a Mortgage Intermediary Section 10. A mortgage intermediary must, before carrying out activities covered by this Order, provide the borrower with the following information on paper or on another durable medium:

1. The company's name and physical address.
2. The public register of the relevant supervisory authority where the company is registered, the registration number or equivalent identification information, and how the borrower can verify the registration.
3. Whether the company is exclusively affiliated with or collaborates with one or more mortgage lenders. The mortgage intermediary must state the name of the mortgage lender(s) on whose behalf the mortgage intermediary acts.
4. Whether advice is provided.
5. Information on any fee for the mortgage intermediary's services or, if this is not possible, information on the fee calculation method.
6. Information on the size of any commissions or other benefits that a mortgage intermediary or its employee receives in connection with the provision of the service, which are relevant and known. The borrower is informed that the information is given in the ESIS form if it is not available at the time of notification.
7. Information on the complaints body and procedure in connection therewith. Paragraph 2. If a non-tied mortgage intermediary receives commission from one or more mortgage lenders, it must, at the borrower's request, disclose how much the commission varies among the different lenders offering residential credit agreements to the borrower. The borrower must be informed of their right to request such information. Paragraph 3. If a mortgage intermediary charges a fee from the borrower and additionally receives commission from a mortgage lender or third party, the mortgage intermediary must inform the borrower to what extent the commission is either wholly or partially offset against the fee. Paragraph 4. Information on the fee that the borrower may have to pay to the mortgage intermediary for its services must be communicated by the mortgage intermediary to the mortgage lender for the purpose of calculating the Annual Percentage Rate of Charge (APR).

General Information on Residential Credit Agreements Section 11. Mortgage lenders or tied mortgage intermediaries must at all times make clear and understandable general information about residential credit agreements available on paper, on another durable medium, or in electronic form. Paragraph 2. Such general information must at a minimum include the following information:

1. Name and physical address of the sender of the information.
2. The purpose for which a residential credit agreement can be used.
3. The form of security, including, where relevant, whether the security can be located in another Member State.
4. The term of the residential credit agreement.
5. Which debtor interest rates are offered, and whether the interest rate is fixed or variable or both, with a short description of the characteristics of fixed and variable interest rates, including the associated consequences for the borrower.
6. The names of the benchmarks and their administrators and the potential effects for the borrower if there are available agreements using a benchmark as defined in Article 3, paragraph 1, no. 3, of Regulation (EU) 2016/1011 of the European Parliament and of the Council on indices used as benchmarks in financial instruments and financial contracts or for the purpose of measuring the performance of investment funds.
7. Indication of a foreign currency or foreign currencies, if a residential credit agreement can be concluded in foreign currency, including an explanation of the consequences for the borrower if a residential credit agreement is given in foreign currency.
8. A representative example of the total credit amount, the total costs for the borrower in connection with a residential credit agreement, the total amount to be paid by the borrower, and the Annual Percentage Rate of Charge (APR).
9. A number of different options for repaying a residential credit agreement to the lender, including the number, frequency, and size of periodic installments.
10. Any additional costs for the borrower in connection with the credit that must be paid in connection with a residential credit agreement.
11. Where relevant, a clear and explicit statement that compliance with the terms and conditions of a residential credit agreement does not guarantee repayment of the total credit amount according to the residential credit agreement.
12. The terms directly relating to early repayment of a residential credit agreement.
13. Whether an assessment of the property is necessary and, if so, who is responsible for ensuring that the assessment is carried out, including whether this entails any costs for the borrower.
14. The ancillary services that the borrower may have to acquire to obtain a residential credit agreement or to obtain a residential credit agreement on the stated terms and conditions, and, if applicable, a clarification of whether the ancillary services can be purchased from a provider other than the mortgage lender.
15. A general warning about the possible consequences of failing to comply with obligations in connection with a residential credit agreement.

Information Requirements in Mortgage Lenders' and Mortgage Intermediaries' Marketing of Residential Credit Agreements Section 12. Any marketing of residential credit agreements that states an interest rate or figures regarding the costs in connection with the mortgage must contain the following standard information:

1. The identity of the mortgage lender or mortgage intermediary.
2. The mortgage or other security underlying the residential credit agreement.
3. The debtor interest rate, and whether it is fixed or variable or both, together with information on the fees included in the costs in connection with the residential credit agreement.
4. The total credit amount.
5. The Annual Percentage Rate of Charge (APR), cf. Section 16 of the Credit Agreement Act, which must have a prominence in the marketing at least equal to any interest rate indication for the mortgage.
6. The term of the residential credit agreement.
7. The size of the payments.
8. The total amount and number of payments to be paid by the borrower.
9. Warning that any fluctuations in exchange rates may affect the amount to be paid if loans are marketed in Denmark in a currency other than Danish kroner. Paragraph 2. The standard information, cf. paragraph 1, must be provided clearly, concisely, and in a prominent manner. The standard information, cf. paragraph 1, nos. 3-8, must be shown using a representative example using one of the two standard assumptions in Annex 1 that is closest to the type of mortgage offered. If the mortgage is only offered under assumptions other than the standard assumptions set out in Annex 1, the commonly used assumptions for the marketed mortgage must be used when stating the representative example. Paragraph 3. If the conclusion of an agreement on an ancillary service, particularly an insurance, is mandatory to obtain the mortgage or to obtain the mortgage on the stated terms and conditions, and the costs of such an agreement cannot be calculated in advance, the obligation to conclude such an agreement must be stated clearly, precisely, and in a prominent place together with the Annual Percentage Rate of Charge (APR), cf. paragraph 1, no. 5. Paragraph 4. The information in paragraphs 1 and 3 must be easily readable or clearly audible depending on the medium used for marketing.

Obligation to Provide Borrowers with Information Free of Charge Section 13. A mortgage lender or mortgage intermediary must provide the borrower with information pursuant to Sections 10 and 11 of this Order free of charge to the borrower.

Simple Loan Overview Section 14. A mortgage lender must issue a simple loan overview to a consumer simultaneously with the provision of a loan offer for a real estate credit loan or a real estate credit-like loan. When issuing loan offers on paper, the simple loan overview must be placed in front of the loan offer. When loan offers are issued on another durable medium, a separate file with the simple loan overview must be placed before a separate file with the loan offer in relation to the reading direction. The separate file with the simple loan overview must be named 'Simple Loan Overview'. Paragraph 2. A mortgage lender must ensure that a mortgage intermediary issues a simple loan overview in situations covered by paragraph 1. Paragraph 3. The simple loan overview must be prepared in accordance with Annex 2.

Chapter 5 Guidance and Advice

Guidance Section 15. A mortgage lender or mortgage intermediary must provide the borrower with guidance on the proposed residential credit agreement and on any ancillary services, such that the borrower can assess whether the proposed product fits their needs and financial situation. Paragraph 2. A mortgage lender or mortgage intermediary must, if the borrower can exercise control over issued real estate credit bonds and manage the sale thereof themselves, inform the borrower of this and provide guidance on the risks associated therewith. Paragraph 3. The guidance in paragraph 1 must among other things include:

1. The information following from Section 7a of the Credit Agreement Act, insofar as it concerns mortgage lenders, and the information following from Section 7a of the Credit Agreement Act and Section 10 of this Order, insofar as it concerns mortgage intermediaries.
2. The material characteristics of the proposed product.
3. The specific consequences that the proposed product may have for the borrower, including the significance of the borrower's payment default.
4. Information on whether each component can be settled separately and the consequences thereof for the borrower if ancillary services are included in a package with the credit agreement.

Advice Section 16. A mortgage lender or mortgage intermediary must explicitly inform the borrower before concluding a residential credit agreement whether advice is or can be provided to the borrower. Paragraph 2. A mortgage lender or mortgage intermediary must, before providing advice or, if applicable, before concluding an agreement on the provision of advice on a durable medium, provide the borrower with the following information:

1. Whether the advice is provided exclusively based on the lender's own product range in accordance with paragraph 4, no. 2, or based on other products on the market in accordance with paragraph 5, so that the borrower can understand the basis for the recommendation, and

2. The size of the fee the borrower may have to pay for the advice or, if the amount cannot be determined at the time of notification, the method used for its calculation. Paragraph 3. The information in paragraph 2 may be given to the borrower in the form of additional information prior to the conclusion of the agreement. Paragraph 4. A mortgage lender or mortgage intermediary providing advice must:

3. Obtain the necessary information about the borrower's personal and financial circumstances and the borrower's specific requirements and objectives, which the borrower has stated, in order to be able to recommend suitable residential credit agreements. Such considerations are based on information that is current at the relevant time and take into account reasonable assumptions regarding risks for the borrower's situation during the term of the proposed residential credit agreement.

4. Take a sufficiently large number of residential credit agreements in their product range into consideration and recommend the most suitable credit agreement(s) among their product range in relation to the borrowers' needs, financial situation, and personal circumstances. Paragraph 5. E

5. The Order 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, OJ 2014, No L 60, p. 34, as amended by Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or for the purpose of measuring the performance of investment funds, and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014, OJ 2016, No L 171, p. 1, and parts of Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council (the Unfair Commercial Practices Directive), OJ 2005, No L 149, p. 22.

Act Gazette A 2025 Published on 3 December 2025 27 November 2025. No. 1443. Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, file no. 25-014194 CQ003425

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