First-Time Buyers
In the Netherlands

Are you an expat dreaming of owning a home in the beautiful Netherlands? 

As a first-time buyer, navigating the Dutch mortgage market can be a difficult task. Understanding the key mortgage-related aspects specific to the Netherlands is crucial for a smooth home buying experience. At Independent Expat Finance, we specialize in providing tailored mortgage advice to expats like you. We’ll walk you through the essential mortgage-related items you need to know as a first-time buyer in the Netherlands, helping you make informed decisions and secure the home of your dreams.

It starts with determining your mortgage eligibility. Mortgage providers typically consider factors such as your type of residence permit or right to live in The Netherlands, employment situation and your credit history. Affordability also plays an important role in the Dutch mortgage market. Mortgage providers use a loan-to-income ratio to assess your ability to repay the mortgage. Understanding this ratio will help you determine your budget and the maximum mortgage amount you can borrow. Factors that impact your maximum borrowing capacity are your income, preferred mortgage set up, tax rebate eligibility, interest rates, energy label and outstanding debts or loans that need to be considered.

Aside from the property’s purchase price, there are additional costs to consider, such as property transfer tax, notary fees, valuation costs, real estate agent fees and mortgage advisor fees. First-Time Buyers under 35 that are buying a property below a threshold of EUR 510.000,- can qualify for a starter exemption and avoid paying any property transfer tax. It is also possible to include renovations or energy saving measures in a mortgage.

In the Netherlands mortgage interest rates can be fixed (between 1 and 30 years) or variable (1 month). Fixed rates provide stability, while variable rates may offer lower initial rates but can fluctuate over time. It is important to consider your financial goals, risk tolerance and market conditions to decide which interest fixed term suits you best. It is also possible to select a combination of different interest fixed terms in a mortgage. Mortgage terms are often 30 years in the Netherlands. The main reason for this is that you are also entitled to a tax rebate on your mortgage interest payments for this amount of time. Choosing the right mortgage term is essential as it affects your monthly payments, interest costs, and long-term financial planning.

There are three mortgage types you can pick from: an annuity mortgages, a linear mortgage and or an interest-only mortgage. Consulting with one of our mortgage advisors will help you identify the most suitable mortgage type based on your financial circumstances and preferences. If you select an annuity or linear repayment scheme, you will be entitled to a tax rebate on the interest you are paying.

NHG is an optional insurance that offers home-owners protection against default and foreclosure. With NHG there is less risk for the mortgage provider, so mortgage providers will offer better interest rates compared to a regular mortgage in The Netherlands of which rates are based on the loan-to-value ratio. A side effect of the better interest rates is that it often slightly pushes up a buyers borrowing capacity. The downside is that you have to pay a one-off commission for NHG, which is 0.6% of the mortgage amount.

We understand this is much information for a first-time buyer. In an intake session with one of our advisors you can also expect clear explanations and ask any further questions you might have. An intake session is always free of charge, just to get acquainted and give information about the services we provide.

Independent Expat Finance

As a first-time buyer in the Netherlands, understanding the essential mortgage-related items is vital for a successful home buying journey. At Independent Expat Finance, we specialize in providing personalized mortgage advice to expats. Our experienced English speaking advisors will guide you through the whole process, helping you make informed decisions and secure the mortgage that fits your needs. Take the first step towards your dream home by contacting us today.