The process of buying an estate in Denmark is usually smooth and easy owing to the complex legal regulations and the cooperation of all parties: the agent, lawyer and bank.
Our guide will help you go through all stages of buying an estate, you will learn about fees and charges you will have to pay in relation with the purchase, and who does what and when along the way to make sure this unusual process is not a mystery to you.
1. LOOKING FOR OFFERS
1.1. The easiest way to look for a house or an apartment is to surf the dedicated websites such as boligsiden.dk or boliga.dk, read local press, browse the websites or visit the real estate agencies such as edc.dk, home.dk, nybolig.dk, danbolig.dk and other.
1.2. The real estate offers contain crucial information regarding the price, metric area, year of construction, number of rooms, energy-efficiency class as well as the list of all fees and charges in connection with the estate, and are to be found at the so called salgsopstilling available online, or on request from the real estate agency.
2. BANK – PRELIMINARY VERIFICATION OF YOUR FINANCIAL STANDING
2.1. Before you start looking for a house or an apartment, you should go to a bank to establish your credit score. A bank will take into account income prospects, financial situation, based on the age of the borrower, årsopgørelse, lønseddel, own contribution, savings, life insurance, other properties, A-kasse payments and other criteria.
2.2. Once you have found your potential place (or more than one), you should present a salgsopstilling in a bank to estimate if you can afford it.
3. REAL ESTATE AGENT AND PROPERTY VIEWING
3.1. Once your borrowing capacity and financial ceiling are already determined, you can see a real estate agent for a property viewing.
3.2. Before you make the decision of buying it, you should view the property to make sure it is the right place and if it meets your family's needs, and if we simply feel good when beeing there. The agent usually show us around the property when the owner is not there, so as to enable the potential buyer to have a critical look at all parts and ask perhaps uncomfortable questions. The agent will also provide you with the documentation concerning the property: tilstandsrapport, el-installationsrapport, bills etc.
3.3. When you finally decide on the particular property and your agent confirms that the
property owner wants to sell it to you, it is time to go to the bank to start the loan application process. Prior to lodging the application, it is worth viewing the property again, this time – accompanied by a person with a good technical knowledge to check the property from this angle thoroughly. It is worth using all technical reports drawn up by the specialists during this viewing to identify any possible gaps and defects.
Remember! It is the owner, not the agent who decides on the sale, the price, who the property is going to be sold to, if at all. The owner may at any time before signing the agreement withdraw from the transaction.
4. Bank – LOAN APPLICATION AND DECISION
4.1. Once you have decided to buy a property, you can apply for a loan. This is the moment in which the bank checks the condition and location of the property and can deny the loan if it considers the property to require too high financial expenses, or if its location in not attractive enough, even if the borrower's financial standing is good.
4.2. Costs of loan disbursement and bank procedures:
- lånesagsgebyr - transaction fee applied for lodging the application and running the case
- mortgage registration fee – 1,5% of the granted loan + DKK 1.660
5. REAL ESTATE AGENT - SIGNING THE AGREEMENT
5.1. The agent prepares all documentation, especially the sales and purchase agreement, and sends them to the seller and buyer for signing. The contract must contain the bankforbehold and advokatforbehold clauses. If they are not present in the contract, ask your agent to complete the contract with these clauses, as they are the buyer's security.
Read more about advokatforbehold clause: Buying a real estate in Denmark
5.2. Documents required by the agent to complete the contract:
- a copy of your national ID, passport or driving licence
- a copy of the "yellow card" (health insurance card)
- opholdsbevis or the data of the buyer's employer (the name and the CVR number)
6. BANK – GUARANTEE AND DEPOSIT
6.1. At this stage, the bank provides what follows:
- Loan Guarantee – a buyer's bank guarantee for the seller to confirm that the seller will receive the payment. It is the amount of the loan granted.
- Deposit (udbetaling) – the amount of money in a closed bank account intended to cover the real estate commissions by the seller; selling price component (not an additional cost for the buyer).
7. LAWYER – CHECKING AND REVIEWING THE DOCUMENTATION
7.1. Having signed the agreement by both parties, pass your lawyer's data to the agent. The lawyer will check the documentation of the estate based on what the agent sends the lawyer. The agent and the lawyer will now cooperate on your case.
7.2. The waiting time for the documentation check by the lawyer is 5-6 working days.
7.3. The remuneration of the lawyer.
8. INSURANCE POLICIES
8.1. Once the agreement is signed and accepted by the bank and lawyer, prior to receiving the house you must:
- buy an insurance against the force majeure events - husforsikring (mandatory) and
- ejerskifteforsikring – insurance against hidden defects in the house (optional).
9. SIGNING THE NOTARIAL ACT - SKØDE
9.1. The preparation of the notarial deed is the lawyer's or the agent's task. They will instruct you where and how the document will be signed. The Notarial Act is available online only. Use the Nem-ID.
9.2. At the time of signing the deed, you are obliged to pay a fee to a bank account provided by the lawyer or the agent:
- 0,6% of the estate's price as agreed in the contract + DKK 1.660
9.3. At the same time, the seller will deregister him- or herself as the owner of the property.
10. RECORDING THE DEED AND MORTGAGE - TINGLYSNING
10.1. After the Notarial Act is signed and the notarial fees paid, the agent or the lawyer sends the deed to the Registry Court - tinglysning, who will deregister the former owner and register the new owner of the property in its register.
10.2. The bank sends to the Registry Court an application for a mortgage registration as a security for the loan, upon the administrative fee (see point 4.2.).
10.3. The above mentioned formalities take place before the possession of the house.
11. THE POSSESSION
11.1. The possession of the house takes place in the presence of the seller, buyer and usually the real estate agent. The parties write down the meter readings, the seller passes the keys and the information regarding the use of the house.
11.2. If the possession takes place without the agent, it is necessary to send the meter readings to the agent. It is the agent who deals with passing the information about the transfer of the ownership so that the new owner is billed from now on.
12.1. The real estate agent or the lawyer draws a detailed list of costs and fees to be paid or returned by the parties – refusionsopgørelse. The settlement is to take place within thirteen days from the date of their acceptance.
12.2. The seller returns to the new owner a part of the insurance policy – ejerskifteforsikring, whereas the new owner returns the overpaid real estate tax (proportionally from the date of the house possession). The settlement may also include other fees and charges.
12.3. The amount to be paid or returned.
Download the guide House buying process – step by step HERE