Lawyer condition and bank condition in the purchase agreement

The adviser condition typically concerns the purchase agreement, the documents and the overall terms of the purchase. The bank condition typically concerns the financing, the buyer's finances and the bank's assessment of the specific home.

What matters is not only whether the words appear in the agreement. You also need to see who must approve what, when the deadline expires, who must be notified, and what happens if the approval does not come.

In brief

• The lawyer condition (advokatforbehold) is also called the adviser condition.
• A broad adviser condition can make the buyer's signature conditional on the adviser approving the purchase as a whole.
• A bank condition can make the purchase conditional on the bank's or the mortgage credit institution's (realkreditinstitut) approval of the buyer, the financing and the home.
• A general preliminary purchase approval (købsgodkendelse) is not necessarily a final approval of a specific property.
• The deadline for the adviser condition is agreed in the purchase agreement.^[2]
• A common wording gives 5 working days after both parties have signed, but the agreement can have a shorter or longer deadline.^[1]
• Approval with comments does not mean the seller automatically has to accept the changes.
• Conditions are not the same as the statutory right of withdrawal (fortrydelsesret).
• New conditions or changes after the agreement has been entered into generally require the seller's acceptance.

What is an adviser condition?

An adviser condition is a term in the purchase agreement that makes the purchase conditional on approval by the buyer's adviser.

It is often called a lawyer condition, because the buyer's adviser is typically a property lawyer. Some clauses use the word adviser instead.

The difference can matter. If the clause says lawyer, do not assume that any other adviser can use the condition in the same way. So check exactly who the clause gives the authority to.

A broad condition can, for example, make the purchase conditional on the adviser's approval of the purchase as a whole. A narrow condition can be limited to specific legal documents or matters.

What does the adviser review?

The task depends on the agreement with the adviser and the wording of the condition.

The review can include, among other things:

• The purchase agreement and the sales listing (salgsopstilling)
• The land register (tingbogen) and easements (servitutter)
• Property data report (ejendomsdatarapport)
• BBR notice (BBR-meddelelse) and building cases
• Local plans and other public restrictions
• Condition report (tilstandsrapport) and electrical installation report (elinstallationsrapport)
• The change-of-ownership insurance (ejerskifteforsikring) offer and its exclusions
• Oil tank and soil contamination
• The owners' association's (ejerforening) accounts, budget and minutes
• Handover day (overtagelsesdag) and right of disposal (dispositionsret)
• Fixtures and other individual agreements
• Deadlines, guarantees and deposits
• Who handles the completion (berigtigelse) of the purchase

The adviser condition does not automatically make the adviser a building or financial specialist. A building question or the bank's credit assessment (kreditvurdering) can require separate conditions and professionals.

What is a bank condition?

A bank condition, also called a financing condition (finansieringsforbehold), can make the purchase conditional on the bank's approval.

The bank's assessment can include:

• The household's income and debt
• Disposable income (rådighedsbeløb)
• Down payment (udbetaling) and net worth (formue)
• The specific home
• The mortgage credit institution's valuation
• Loan type and loan-to-value ratio, LTV (belåningsgrad)
• The bank's ability to provide a guarantee
• Documentation and other credit terms

The bank condition has no statutory standard content. The exact wording decides what must be approved, and what happens if the approval is not in place before the deadline.

Lawyer condition and bank condition in one table

One condition therefore does not automatically replace the other.

Why is a pre-approval not always enough?

Before your home search, the bank may have calculated a provisional purchase budget. This is not necessarily the same as a final approval of a specific purchase.

When you find the home, the bank may also need to assess:

• Whether the home's value supports the financing
• Whether the property can be mortgaged as expected
• Whether there are special issues with its condition or use
• Whether the actual owner costs (ejerudgift) fit the budget
• Whether the loan can be structured as assumed
• Whether your finances or documentation have changed

Example

You are provisionally approved for a purchase budget of 4.000.000 kr. and sign a purchase agreement for 3.900.000 kr.

The mortgage credit institution then values the home below the purchase price. This can change the split between your own money, the mortgage loan (realkreditlån) and the bank loan.

Whether the bank condition protects you in that situation depends on how it is worded.

Also read the guide on the bank meeting before buying a home.

The wording decides the protection

Two conditions with almost the same heading can have different effects.

Read these elements in particular:

Read the condition as a contract, not as a heading.

Broad and narrow adviser conditions

Broad condition

A broad condition can cover the adviser's approval of the purchase as a whole.

It can make it possible to respond to several types of problem in the documents and the purchase agreement. The actual scope still depends on the wording and the way the condition is used.

Narrow condition

A narrow condition may, for example, only cover:

• Easements
• The owners' association's documents
• Approval of a specific conversion
• A specific matter with the authorities
• A specific document that is missing

If the problem lies outside that subject, the condition may be insufficient.

When does the deadline start?

The clause in the purchase agreement decides when the deadline starts.

A common wording lets the deadline run from when both parties have signed. Boligejer.dk describes a common wording with 5 working days, but stresses that the deadline can be agreed to be shorter or longer.^[2]

So check:

1. When the buyer signed
2. When the seller signed
3. When the buyer was notified of the seller's signature
4. Which event the clause uses as the start
5. Whether the day of signing counts
6. How working days and public holidays are treated
7. The exact time of expiry

Example timeline

The table does not set the legal expiry date. Weekends, public holidays, wording and time of day must be checked in the specific agreement.

The notice must arrive in time

It is normally not enough to start the review before the deadline. If the clause requires objections, they must have reached the specified recipient before expiry.

Pay attention to:

• The correct email address
• Any named recipient
• Requirements for written notice
• Time of day
• Automatic out-of-office replies or delivery failures
• Documentation of sending and receipt

An adviser may need documents that have not yet been received. If the deadline is to be extended, this normally requires an agreement with the seller or the seller's representative before the existing deadline expires.

Approval, comments and rejection

The adviser's response can take different forms.

Approval without comments

The adviser states that the purchase can be approved. The adviser condition is then normally resolved, but the bank condition and other conditions may still be open.

Approval with comments

The adviser can make the approval conditional on:

• A document
• A correction to the purchase agreement
• A clarification from the seller
• A specific condition
• A financial adjustment
• Clarification from the authorities

The seller can accept, reject or propose another solution.

No approval

If the adviser cannot approve the purchase, the consequence depends on the wording of the condition and on timely notice.

An adviser condition does not automatically give the buyer the right to rewrite the agreement unilaterally. It can make it possible to withhold approval or set conditions, but changes require agreement.

What happens if the seller says no?

Imagine that the adviser approves the purchase on condition that the seller has an extension approved.

The seller can:

1. Accept and have the matter resolved
2. Propose another solution
3. Reject the change

What happens next depends on the adviser condition and the notice that has been sent.

It is therefore important that the adviser's letter does not merely describe a wish, but clearly shows whether the purchase is approved, approved subject to conditions or not approved.

Three practical examples

1. The bank approves the buyer, but not the financing of the home

The buyer has a provisional financial approval. The specific property is valued lower than expected, and the bank will only finance the purchase if the buyer puts in more of their own money.

A bank condition may be relevant, but the outcome depends on whether the clause covers the specific financing and the approval of the home.

2. The adviser finds an easement

An easement restricts the extension the buyer had planned.

A broad adviser condition can make it possible to respond before the deadline. A narrow condition that only concerns financing does not necessarily do so.

3. The condition report has a question mark

The buyer wants a closer damp investigation. An ordinary adviser condition is not necessarily the same as a specific building inspection condition with access, investigation and consequence.

See also the guides on the condition report and the building surveyor when buying a home.

Adviser condition versus right of withdrawal

The two options must be kept separate.

Boligejer.dk explains that the buyer as a rule has 6 working days and must pay 1 per cent of the purchase price if the statutory right of withdrawal is used.^[1]

The deadlines can run at the same time. So do not put off the adviser condition just because the statutory withdrawal deadline has not yet expired.

Before the seller has signed

When the buyer has signed first, the document is normally an offer to the seller.

If the seller has not yet accepted the offer, the buyer can normally revoke it, provided the revocation arrives before or at the same time as the acceptance.

Once the seller has signed, there is as a rule an agreement, but it can still be conditional on the adviser condition, the bank condition and other agreed terms.

Ownership and the practical completion of the purchase follow later through, among other things, the deed (skøde), payment and handover. Read the guide on completion, deed and land registration.

Other conditions may be necessary

A broad adviser condition can be important, but some matters may require a more precise clause.

These can include, for example:

• Sale of your own home
• Building inspection
• Soil survey
• Oil tank and soil contamination
• Approval of an extension
• Clarification of BBR
• Municipal permit
• The owners' association's approval
• A specific form of financing
• Removal of an easement

A specific condition should describe:

• What must be investigated or obtained
• Who must approve
• The deadline
• How notice is given
• What happens if the condition is not met
• Whether the seller gets the chance to remedy the issue

Also read the guide on oil tanks and soil contamination.

Special points for owner-occupied flats

For an owner-occupied flat (ejerlejlighed), the adviser's review can include, among other things:

• The owners' association's articles of association
• Minutes of general meetings
• Accounts and budget
• Joint loans
• Maintenance plan
• Planned projects
• Allocation keys
• Rights of use
• House rules and restrictions on letting

If key documents are missing, the deadline must allow time for them to be obtained and assessed. An adviser condition does not automatically extend itself because an appendix is missing.

Checklist before you sign

The adviser condition

• Who may approve the purchase?
• Does it cover the purchase as a whole?
• When does the deadline start?
• When exactly does it expire?
• Who must be notified?
• Must objections give reasons?
• What happens if nobody acts in time?

The bank condition

• Does it cover both the buyer and the specific home?
• Does it cover the mortgage credit valuation?
• Does it cover the expected financing terms?
• Must the bank give a written refusal?
• When does the bank's deadline expire?

The documents

• Has the adviser received the full purchase agreement?
• Is the sales listing included?
• Have all reports and property documents been received?
• Is the owners' association material complete?
• Are special risks described in separate conditions?

The timetable

• Do you know when the seller signed?
• Does the bank have time to process the case?
• Has the adviser confirmed receipt?
• Has any extension been agreed in writing before the deadline?

Common misunderstandings

The lawyer condition always applies for 5 days

No. 5 working days is common in a standard wording, but the purchase agreement decides the deadline.

A bank condition is covered by the lawyer condition

Not necessarily. They have different purposes and can have different scope.

The bank has approved my budget, so the home is approved

Not necessarily. The specific property and the financing may still need to be assessed.

I am free to do as I like while the deadline runs

Only within the wording of the clause. A condition is not a general pause in the agreement.

The adviser can change the purchase agreement alone

No. The seller must accept new terms.

The deadline is extended if documents are missing

Not automatically. An extension normally has to be agreed in time.

The condition and the right of withdrawal are the same thing

No. They have different legal bases, deadlines and financial consequences.

A refusal from the bank always releases the buyer

Only if the bank condition covers the situation and the requirements for deadline and notice are met.

In short

An adviser condition and a bank condition do not do the same job.

The adviser reviews the agreement and the documents. The bank assesses the finances, the financing and the specific home. Both conditions must be read word for word.

Check in particular:

1. Who must approve
2. What the approval covers
3. When the deadline starts and expires
4. Who must receive written notice
5. What happens if the approval is missing

The bank's approval is based on your overall finances. You can bring together the purchase price, your own money, debt and transaction costs in the Purchase Budget calculator.

Also read the guide on bidding rounds and conditions and the purchase budget when buying a home.

BoligKlar gives you a second pair of eyes and an overview. The specific wording and use of a condition should be assessed on the basis of the purchase agreement and the individual purchase.

Frequently asked questions