2 October 2023How to get a mortgage in the Netherlands

Are you an expat considering your own home sweet Holland? Scratching your head on how to begin and own the process? We get it. That’s why, we are here to provide you with invaluable insights to make your journey to get a mortgage as smooth as butter.

Providing You Comfort

When it comes to a residential mortgage the government’s role is to protect you from financial risk. They take this job seriously – as they should because your mortgage will probably be the biggest debt you will ever have. The highlights:

• Every financial institution you are dealing with is under strict supervision from the government
• As a consumer, you are mandatory to have mortgage advice from an expert upfront. With this, they guarantee that you will have a mortgage structure fitted for you
• Regulation shows strict guidelines for every mortgage provider and advisor to determine your borrowing capacity

Time For Action – Mortgage Advice

Knowing that the mortgage process is well organised you can take the first step and delve into the relevant information. For official mortgage advice you can go to a bank directly (some banks – not all – offer this service) or you can go to an independent mortgage advisor (like Klår) who has access to all parties available.

You can view the main difference as follows: banks will be able to inform you about their specific products (good – but limited), whereas an independent mortgage advisor can guide you in the marketplace and link you to the best suitable mortgage for you. At Klår we take this service to another level… we even try to make the whole journey a little bit fun!

Let the Math Do The Talking – Guidelines

When it comes to financial risk the government have a set of rules that determine your financial budget:

1. Loan to income: your maximum borrowing capacity is based on your gross yearly income. The rule of thumb is that your annual mortgage costs cannot exceed a specific percentage of your annual gross income (approx. 25% – 30%). Entrepreneurial incomes are also possible (requires a little extra work on our end 😉)
2. Loan to value: the mortgage cannot exceed the worth of the property (unless you are interested in energy related investments)

A Buffet Of Choices

Determining your mortgage capacity is one thing, getting the best fit for you is another. There is a lot to think about, like:

• Which fixed interest period do you prefer?
• Do you need flexibility with your repayments?
• Do you need the 30% ruling taken into consideration?
• Are you buying a new build or a fixer-upper?
• And lots more!

Although a mortgage seems to be a quite ‘standard’ service… there are many small differences within the conditions that different providers offer which can make a huge impact.

The Key To Success

Having a smooth process with a positive result is a lot like having a clear roadmap. With this, you can easily reach your destination without getting lost or encountering barriers that lead to delay, or even worse. To get this clear roadmap a strong inventorization is what you need (your checklist will include: your passport, residency permit, payslip, employer statement, at much more). All information needs to be in order and presented in a way banks can process it efficiently and with comfort.

The Final Piece Of The Puzzle

In The Netherlands, the mortgage application begins after you have closed a purchase deal for a home. On average you have 4 to 6 weeks to arrange your mortgage. Thus, it is crucial to be confident in your budget and have your documentation complete up front and before purchasing. If you are looking for this assurance we are more than happy to be your partner.

First, we start with a personal meeting where we will tell you everything about the Dutch mortgage system. Based on your personal situation we will draft a report including a detailed assessment (exactly like a bank will do) about your borrowing capacity, insights into financial structures and different monthly repayment scenarios. All are personalized to make sure you know exactly what your options are, where you might be stretching your financial capacity and how possible hiccups in a process can be avoided. With this, your chances of success for a new home will increase substantially.

*Probably not your biggest concern, but it is nice for you to know that the “get ready to start” fee is also deducted from your total fee at the end of the process.

Have we piqued your curiosity? Just give us a call!
We will help you gain clarity and get focus.