Construction financing netherlands

Construction financing netherlands: with its miles of beaches on the north sea and historic canal towns, holland is a popular vacation destination. More and more germans are deciding to buy a vacation home in holland or to spend their retirement in the neighboring country. The desire for a permanent residence in holland is often linked to the purchase of a property.

Generally, a mortgage from a dutch bank is used to finance your home. The amount of the mortgage loan is determined by various factors, which will be discussed in more detail below. Anyone wishing to take out a loan in holland must disclose their income situation.

Mortgage borrowing in Holland

Loan in holland as a german

If you want to take out a mortgage in holland, you have to disclose your income situation. The level of annual income forms an essential basis for determining the maximum amount for a mortgage loan.

Real estate financing netherlands

As a general rule, the maximum loan amount is approximately 4-5 times your annual income. In practice, this means that with an annual income of 50.000 euro the upper limit for the mortgage loan is about 240.000 euro.

Take out a loan in the netherlands

The lower the annual income, the lower the amount of the loan, although if the income is more than 100.000 euro per year the amount of the loan can also be more than 5 times of the sum.

It should be noted that this calculation is only used if there are no other liabilities. If there are other loans to be repaid, the outstanding amount will be deducted from the income.

Financing real estate in the netherlands

The second criterion used to determine the loan amount is the value of the property. The actual market value and the value in the event of foreclosure are relevant for the granting of mortgages in holland.

The market value of the property is determined by an independent appraiser, called a taxateur in dutch. Usually a local real estate agent who is familiar with the prices of residential and commercial properties in the respective location.

Construction financing via dutch bank

The value in the case of foreclosure is naturally lower than the market value of the property. Discounts of up to 20% must be taken into account when determining the value of the property. The majority of banks grant their customers a mortgage loan that is approximately 125% of the value that can be obtained in a foreclosure sale.

Alternatively, the value determined on the basis of the annual income is taken as a basis. It depends on which amount is lower. If renovation work is planned, 80% of the costs can be added to the value of the property. It is a prerequisite that the auditor receives a detailed list of the intended work, including a breakdown of costs.

Documents to apply for a mortgage

Before you make an appointment with a dutch bank for a loan meeting, you must gather all the necessary documentation. The following documents are required to apply for a mortgage loan in holland:

  • Copies of the passports of all persons involved in the purchase of the property
  • Copy of the moving permit (vestigingsvergunning) if required
  • Copy of the preliminary purchase contract with valid signatures
  • Valuation report from the tax assessor in the original
  • Certified proof of income in original (issued by the employer)
  • Copy of the current wage or salary statement

Real estate financing holland for self-employed

Self-employed persons and freelancers must provide evidence of the income generated in the last three years on the basis of tax assessment notices and balance sheet statements. The average income of the last three years or the average of the last year is used as the basis for calculating the loan amount – always depending on which amount is lower.

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