When 33-year-old Diego Lizárdez-Ruiz decided to buy an apartment in Copenhagen, he discovered that some of the local banks he approached for a loan saw him less as a person with a career, credentials and connections in Copenhagen – and more as someone who might skip the country and default on his loans. Because he isn’t Danish.

 

Lizárdez-Ruiz is a citizen of both Argentina and Spain who has lived in Copenhagen for a total of six years. He first came to Denmark in 2004 to work for a Copenhagen-based non-profit and to write his thesis.

 

He moved to Belgium in 2005 for a job, but was lured back to Copenhagen a year later by an offer from the CEO of Omada A/S in Østerbro. For the past five years he has worked for Omada as a senior consultant and product manager.

 

His search for a mortgage began quite naturally at his own bank, Danske Bank, where he has been a client for five years. Lizárdez-Ruiz says he never had a problem with Danske Bank before, and at first, the process went positively. He was given a loan advisor who reviewed his finances and told him he qualified for a loan of approximately 2.8 million kroner with a cash down-payment of five to ten percent of the purchase price. 

 

But a few weeks later, when he found an apartment he wanted to buy and called to confirm that the loan was in order, he got a shock.

 

The same person, who earlier told him he could get the mortgage with a five to ten percent down-payment, now said he would need to pay 15-20 percent up front – soley because he is not a Danish citizen.

 

Lizárdez-Ruiz describes the Danske Bank loan advisor, whose identity is known to The Copenhagen Post, as professional and polite. He said she apologised for the change of terms and explained that she had received a notification from the main office saying that Lizárdez-Ruiz needed to make a larger down-payment because he is not a Danish citizen. According to Lizárdez-Ruiz, she read parts of the above-mentioned notification to him over the phone in Danish. 

 

However, citing company policy she refused his request for a written confirmation of what she had told him verbally – namely, that he had to pay more than a Danish citizen would.

 

“In my last conversation with [her] last week, she said: ‘I am sorry, I do not make the rules. You also mentioned that your family lives in Argentina. So even if you are Spanish, if you have any problems here, you will probably go back there and that makes it very difficult for us to get the money back’”, Lizárdez-Ruiz told The Copenhagen Post.

 

He said he was shocked that she would assume that, as a foreigner, he was more likely to default on his debts. 

 

“Instead of analysing your background, your reputation, or how respectable and honest you might be, they simply take the easy road of associating risk with nationality,” he said.

 

The loan advisor did not respond to our requests for an interview, but Danske Bank’s head of international private clients, Henrik Skov Nielsen, maintained that it was “a misunderstanding”.

 

“Citizenship has no influence on our assessment, as each customer is advised individually based upon their financial situation,” Nielsen added. “We would never expect anybody not to pay their debt because they are a certain nationality.”

 

Nielsen could not discuss Lizárdez-Ruiz’s financial information with a third party, so The Copenhagen Post was unable to confirm why Lizárdez-Ruiz was first told that he could pay a 5-10 percent down-payment, only to be told a few weeks later that he would have to pay 15-20 percent.

 

Lizárdez-Ruiz decided to try two other banks.

 

One of them, Nordea, also told him that he would have to raise 20 percent himself – with the reason being that he is a foreigner. Unlike Danske Bank, however, Nordea’s loan advisor, whose identity is also known to The Copenhagen Post, agreed to send him a written confirmation of the reason.

 

Lizárdez-Ruiz showed The Copenhagen Post the email from the loan advisor. The specific content is protected by the bank’s confidentiality clause, but in the message the advisor states explicitly that the customer is required to pay 20 percent cash down if he or she is not a Danish citizen. The message also says that Nordea is requiring a larger guarantee from “foreign visitors” because of present instability in the housing market.

 

Having lived and worked in Copenhagen for a total of six years, Lizárdez-Ruiz considers himself more than a foreign visitor. 

 

“I am working in Denmark, paying full taxes – 42 percent – contributing to the educations of Danish kids,” he said. “I pay as much as any Dane, but I can’t get a loan to buy a place to live?”

 

The Nordea loan officer did not respond to our requests for an interview. However, Nordea Denmark’s head of private customers, Ken Adrian, asserted that the bank does not base its mortgage terms on nationality.

 

“Nordea does not distinguish between Danish and foreign citizens when granting a housing loan or any other loan. The conditions of the loan solely depend on a credit valuation of the customer,” Adrian asserted. “The credit valuation has been paramount in this case, as always.”

 

As to why Lizárdez-Ruiz received an email from a Nordea loan officer confirming that he had to pay a 20 percent cash down-payment because he is not a Danish citizen, Adrian answered that Nordea regretted that the customer “did not receive a proper reason”.

 

“It is very worrying that neither [Danske Bank nor Nordea’s loan officers] recognised this as discriminatory. For them, it seemed natural that non-Danes are riskier,” Lizárdez-Ruiz said.

 

The Ministry of Economic and Business Affairs has an executive order that requires banks to treat clients fairly and not use nationality as a basis for credit valuation. But as long as personal traits such as nationality, race and gender are left out of the equation, banks are entitled to determine for themselves who is a good credit risk, who to loan money to, and how much.

 

“I have never heard of nationality being the reason for rejecting a loan, but that’s not to say it is not done,” Thomas Brenøe, the director of the Danish Complaint Board of Banking Services, told The Copenhagen Post.

 

After his experiences with Danske Bank and Nordea, Lizárdez-Ruiz tried his hand at a third bank, Spar Nord, and got a different response. The bank gave him a firm offer of up to 100 percent of the value of the property – the same as any Danish person in his financial situation.

 

“I don’t know why the other banks have the procedures,” John Stærfeldt Glerup, the head of Spar Nord’s private department told The Post. “We consider all of our customers equal in the sense that if you can pay back your loan and you have permission to be in Denmark, and you want to be in Denmark for a longer term, we think you should be able to buy a home.”