Fixed or variable rate on a mortgage in Denmark? How to choose

The short answer: a fixed rate suits you if you want to know your payment for the whole term and sleep soundly. A variable rate suits you if you have room in your budget for the payment to rise and do not fear big rate increases. Either way, the bank must stress-test your budget at the current rate plus 1 percentage point, minimum 4 %.

Fixed rate: a fixed payment and a safety net

With a fixed-rate loan the rate is the same for up to 30 years, so the payment is locked. The rate is typically higher than a variable one at the outset, but you get two advantages in return. If rates fall, you can convert to a cheaper loan. If rates rise, you can repay the loan below kurs 100 and cut your outstanding debt.

The ongoing fee (bidragssats) to the mortgage institution, which you pay on top of the rate, has been cut on several new fixed-rate loans in 2026. That makes a fixed rate more attractive than before.

Variable rate: F-kort, F3 and F5

A rate-adjustment loan gets a new rate at set intervals: an F-kort every 6 months, an F1 yearly, an F3 every 3 years and an F5 every 5 years. The F3 is today the most chosen new variable loan, more than one in three, while F1 and F5 each make up about 18 %.

The shorter the fixing, the lower the starting rate, but the more often the payment can change. You trade a lower rate for uncertainty about the payment at the next reset.

Conversion: the hidden advantage of a fixed rate

A fixed rate gives a conversion right. If rates fall, you can convert down to a lower rate. If rates rise, you can convert up: repay the loan below kurs 100 and reduce your outstanding debt. This is a flexibility a variable rate does not give in the same way, and it is worth counting in when you compare the two types.

The rules can decide the choice for you

If your debt is over 4 times household income together with a loan-to-value over 60 %, the bank may as a main rule not give you a variable rate or interest-only. In 18 larger city municipalities, including Copenhagen and Aarhus, requests for a variable rate are assessed more strictly. For some buyers a fixed rate is therefore not a choice but a requirement in the credit assessment.

Who suits what?

First-time buyers with a tight budget and a small buffer are often best served by a fixed rate and a predictable payment. Buyers with good savings, high income and room for swings can use a variable rate to keep the payment down, as long as they can carry an increase. Also consider a rate lock up to completion, so the rate does not drift away while you wait.

To see what the payment becomes at one rate and another, paste the listing into Heimer, and we will work out the monthly cost for you, with and without a rate stress test.