Mortgage vs. bank loan: how a home purchase is financed in Denmark
A Danish home purchase is paid with up to 80 % realkredit, a bank loan on top and at least 5 % down payment. See why it is split, what the difference costs, and how a larger down payment lowers your monthly cost in Denmark.
Updated: 2026-07-17
The short answer: a Danish home purchase is financed by three parts. Up to 80 % as a realkredit loan, a bank loan on top and at least 5 % down payment of your own money. Realkredit is the cheap base, the bank loan covers the gap, and the down payment is your own stake.
The realkredit loan: the cheap 80 %
You can borrow up to 80 % of an owner-occupied home as a realkredit loan (75 % for a holiday home). The rate is low because the loan is secured in the home and funded by the institution issuing bonds and selling them to investors. The term is up to 30 years. This is the part of the financing you most want to maximise.
The bank loan: the gap up to the price
Realkredit stops at 80 %, and you must put in at least 5 % yourself. The rest, typically up toward 15 %, is covered by a bank loan. Its rate is higher than the realkredit loan, the term often shorter, and terms vary more by bank. So it pays to gather offers from several banks on exactly that part.
The down payment: your minimum 5 %
When buying an owner-occupied home you must pay at least 5 % of the price in cash. On a 3 mio. kr. home that is 150,000 kr., which neither the mortgage nor the bank loan may cover. If you have more savings, you can shrink the bank loan and save on the expensive part of the financing.
The bidragssats: the ongoing price of realkredit
On top of the rate you pay a fee (bidragssats) to the mortgage institution. The average has been around 0.80 %, and it rises with the loan-to-value ratio, so it is most expensive on the top part near 80 %. Several institutions cut the fee on selected loans in 2026.
Why is it split, and what does the difference cost?
The split exists because realkredit may by law only go to 80 %, and because the bond model keeps that part cheap. The bank loan is more expensive precisely because it sits on top and carries the most risk. The maths is simple: the larger your down payment and the smaller the bank loan, the lower your total monthly cost.
To see what your specific financing costs per month, paste the listing into Heimer. We add realkredit, bank loan and down payment into one monthly figure, stress-tested for a higher rate.
Terms to know
Common questions
Why can I not borrow it all as realkredit?
The law sets the limit at 80 % of an owner-occupied home. The rest must be covered by a bank loan and your own down payment.
How much must I pay myself?
At least 5 % of the purchase price for an owner-occupied home. On 3 mio. kr. that is 150,000 kr., which neither the mortgage nor the bank loan may cover.
Is a bank loan much more expensive than realkredit?
Yes, the rate is higher because the bank loan sits on top and carries more risk. So it pays to keep the bank-loan part as small as possible.
What is bidragssats?
It is an ongoing payment to the mortgage institution on top of interest, on average around 0.80 % per year. It rises with the loan-to-value ratio.
Can I avoid a bank loan entirely?
Yes, if your savings cover the last 20 %. Then you only take realkredit to 80 % and a down payment for the rest, and avoid the expensive bank-loan rate.
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