How to register a Danish Mortgage Loan

Created by Erik Åkerlund, Modified on Mon, 20 Feb 2023 at 02:30 PM by Erik Åkerlund

Go to New deal and choose Danish Mortgage Loan

On a Danish Mortgage Loan it is the most common to choose Annuity (Recalculate). It means that when changes are made on the interest % Treasury systems will recalculate the annuity (Ydelse) from that date and onwards.

You can read more about different Amortisation Type

Depending on the agreement there are different methods to calculate the Annuity. If you click the USE ROUNDED ANNUITY RATE, Treasury Systems calculates an Annuity rate that are used when calculated the Annuity. This rate will be rounded to 6 decimals.

(From our findings it seems to be used by Real Kredit Denmark but it might not always be the case and could also be used by other Institutes)

If you click Use multiple day conventions, (common in agreements with Real credit Denmark) Treasury systems use multiple day convention ( ACT/360 respectively ACT/ACT ICMA)  to calculate the interest for the first period, if it is longer than the "normal" periods. This will only work if you have selected ACT/ACT ICMA as Interest Convention.

In the next Tab, Basics you enter the Bond Price ( this field is only for information, not used in any calculations within Treasury systems) Enter dates and under amortisation period, enter when the first amortisation will be paid.

In the interest Tab you enter the fixing index (if floating) and the percentage for bidrag.

Enter the base interest (floating interest in the picture below). 

Spread is the spread on the interest but is usually not used on Danish Mortgage Loans.

Fill in the Interest Conventions that should be used. ( As far as we know it seems that  ACT/ACT ICMA are most commonly used but please verify in your agreement).

Some agreements stipulate that if there is negative interest the Loan amount should then decrease with the interest amount.  If that is the case please tick the box

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