Rural homebuying scheme rarely used

An initiative designed to simplify acquiring home loans in rural areas of Denmark has only been utilized twice in two years. This scheme, managed by Finansiel Stabilitet and reported by Børsen, was introduced in July 2020 to provide state guarantees for part of housing loans rejected by banks. The Social Democrat-led government at the time intended to shift some lending risk to the state to stimulate financing in these regions. Expectations were set for the equivalent of 500 loans last year. Simon Kollerup, then Minister of Industry, labeled it a significant victory but banks had countered, saying refusals were only due to lack of creditworthiness. The guarantee covers most of a home loan between 60 to 90 percent of a property’s value, focusing on homes priced below certain thresholds. While temporary, there’s an ambition for permanence amid lack of awareness among realtors and citizens, according to the Landdistrikternes Fællesråd chairman.