The repayment of (part) of the mortgage loan to the credit institution.
Aftrekpost (Tax-deductible item)
Expenses that are tax-deductible. If you are a home-owner and the home in question is your main place of residence, all of the finance charges for the home are tax-deductible. For example, the brokerage commission, the valuation costs, the costs of the mortgage deed and the costs associated with the Dutch National Mortgage Scheme (Nationale Hypotheek Garantie). Furthermore, under certain conditions, the mortgage interest is also tax-deductible for a period of 30 years.
Bankgarantie (Bank guarantee)
The seller generally demands a deposit or bank guarantee as extra security. If the buyer withdraws from the purchase after the let-out clauses have expired, the seller is entitled to compensation. The deposit is generally 10% of the selling price. The purchaser may choose to arrange a bank guarantee rather than paying the deposit in cash. This is a written declaration from a credit institution, which is filed with the notary. The amount is only paid if the purchaser does not meet his obligations.
Bijleenregeling (Dutch additional loan regulation)
The additional value (home-owner’s financial reserve or ‘eigen woningreserve’), which is released when the home is sold must be reinvested in the next home that is purchased, as the mortgage interest on that portion of the loan is otherwise not tax- deductible.
Bouwkundig keuringsrapport (Structural survey)
A structural survey is designed to assess the structural condition of a home. In the Netherlands, a structural survey is compulsory for pre-1940 apartments in cases where a Dutch National Mortgage Scheme (Nationale Hypotheek Garantie) has been applied for.
Bureau Krediet Registratie or BKR (Dutch Credit Registration Bureau )
This bureau registers all loans other than mortgage loans. These loans are taken into account when assessing a mortgage application. The credit institution asks the BKR to provide a report of the applicant’s current loans and if he is (or has been) in arrears with his repayment instalments.
Consumptief krediet (Consumer credit)
These loans (overdraft facility and personal loan) are used to finance the purchase of consumer products such as cars, boats or caravans. Loans of this type are registered with the Dutch Credit Registration Bureau (Bureau Krediet Registratie or BKR) in Tiel.
Contractrente (Contractual interest)
This is the agreed interest rate specified in the signed mortgage quotation/deed.
Courtage (Estate agent’s fee)
You may choose to involve an estate agent when you buy a house.
The costs of his services are known as ‘makelaarscourtage’ or the estate agent’s fee. The size of the fee depends on the services you ask the estate agent to provide or the services that the estate agent offers.
Dagrente (Current interest)
The interest rate that is in effect on the date on which the notary executes the deed.
Dalrente (Lowest interest)
The mortgage quotation specifies an interest rate that will apply on the date on which the notary executes the mortgage deed. If, in the period between the date of the quotation and the date on which the deed is executed, the interest rate falls and then possibly rises again, you will be offered the lowest rate in that period, which is known in Dutch as the ‘dalrente’.
Effectieve rente (Compound interest rate)
This rate was determined in order to enable you to better compare offers. The ‘Code of Conduct on Mortgage Financing’ requires that this interest rate be specified. The compound interest rate takes account of the commission charged when taking out the mortgage, and the fact that you do not pay interest per annum but per month. The compound interest rate is therefore always somewhat higher than the nominal interest rate.
Eigen woningforfait (Taxable amount for home-owners)
As a home-owner in the Netherlands, you will have to fill in the ‘inkomsten uit de eigen woning’ (income arising from a property owned by the taxpayer) section on your tax return. This income is called the ‘eigen woningforfait’ or taxable amount for home-owners. This amount is a percentage of the ‘WOZ-waarde’, which is the value of the home as calculated for the purposes of the Dutch Valuation of Immovable Property Act (WOZ).
Eigen woningreserve (Home-owner’s financial reserve)
The difference between the amount for which a house is sold and the remaining unpaid loan sum.
Eigendomsakte (Title deed)
This deed, which also known as the ‘overdrachtsakte’ or deed of transfer, is drawn up by the notary when a house is purchased and subsequently filed with the Dutch Land Registry Office (Kadaster).
Eindkapitaal (Final capital)
The amount that has been accumulated when a life insurance plan matures or an investment account is terminated.
Erfpacht (Ground lease)
The land on which a house has been, or is to be built, may be leased. In other words, it does not belong to the home-owner. In such cases, the home-owner pays a fixed annual amount to the owner of the land.
This fixed amount is also referred to by the Dutch word ‘canon’, which means ground rent. The ground lease may also be bought off in a single payment.
Executoriale verkoop (Forced sale)
If a home-owner is unable to meet his obligations vis-à-vis the credit institution, the credit institution is entitled to sell the house. This generally takes place at auction. Houses offered at auction are often sold for less than when sold privately and the proceeds may not be enough to completely repay the mortgage loan. This means that the home-owner still has to pay off part of the original mortgage loan.
Geldverstrekker/financier (Credit or lending institution)
This is the financial institution that extends the loan.
Herbouwwaarde (Reconstruction value)
This is the amount required to rebuild a house when, for example, it has been destroyed in a fire. This value is specified in the valuation report and is used to calculate the compulsory home-owner’s insurance policy premium.
A financial loan for which the house serves as collateral until the loan has been redeemed.
Hypotheekakte (Mortgage deed)
This deed is drawn up by the notary and describes the details of the mortgage, the credit institution, the mortgagor (the customer) and the terms. The deed is filed in the land and mortgage register at the Dutch Land Registry Office (Kadaster).
Kadaster (Dutch Land Registry Office)
All immoveable property (real estate), and some other types of property, are registered with the Dutch Land Registry Office. This body can provide information about the house owner, the purchase amount the last time the house was sold, the surface area of the real estate and the mortgage.
Kosten koper or K.K. (Extra costs payable by the purchaser)
When an existing house is purchased, various costs such as transfer tax and notary’s fees are incurred. These are not included in the selling price and have to be paid by the purchaser. Together with other associated costs, they amount 5% of the selling price.
Makelaar onroerend goed (Estate agent)
A broker who acts as an intermediary when buying or selling real estate.
Maximaal hypotheekbedrag (Maximum mortgage amount)
Before starting to look for a house, it is sensible to have an expert work out the maximum amount that you can spend on your mortgage. The Hypotheek Haarlem advisor can help you with this.
Nationale Hypotheek Garantie or NHG (Dutch National Mortgage Guarantee Scheme)
This scheme guarantees that the credit institution will be repaid if in a forced sale the house sells for less than the value of
the total remaining mortgage debt. The credit institution acknowledges the reduced risk by charging a lower rate of interest. The Dutch Home-ownership Guarantee Fund (Stichting Waarborgfonds Eigen Woningen) guarantees repayment of the loan (mortgage) to the credit institution. Obviously, this Fund will try to recover the debt from the mortgagor (customer).
Onderhandse verkoopwaarde (Sales value in a private sale)
This is the value of house when sold under normal circumstances on the open market and is sometimes also referred to as the
‘vrije verkoopwaarde’ (open market value).
This is the property, such as the house that has been purchased, for which the mortgage loan has been extended. The collateral is a kind of security for the credit institution.
This term is used when the insured value of your household contents is lower than the true value. You can easily determine the true value using the ‘inboedelwaardemeter’ (household contents valuation aid).
Ontbindende voorwaarden (Let-out clauses)
Various stipulations can be included in the ‘voorlopig koopcontract’, or preliminary contract of sale, which allow the parties to withdraw from the contract under certain circumstances. The ‘financierings-voorwaarde’ or financing clause is a typical example. The purchaser may withdraw from the sale if he is unable to arrange adequate finance.
Opstalverzekering (Home-owner’s insurance)
Credit institutions take your house as collateral for the amount of the mortgage loan. In order to avoid the risk of damage to your house reducing the value of the collateral, they oblige you to take out home-owner’s insurance. This insurance policy covers damage to your house that may for example be caused by bad weather or fire.
Overbruggingskrediet (Bridging loan)
If you have purchased another house, but your current house has not been sold at the time of transfer of title, you can use the
‘overwaarde’ or surplus value in the house that still has to be sold to take out a bridging loan. The terms and conditions for this type of loan vary from credit institution to credit institution.
Passeren (Execution of a deed)
This refers to the act of signing the transfer deed (transportakte) and mortgage deed (hypotheekakte) at the offices of the notary. You own the house once these deeds have been signed.
Rentebedenktijd (Interest rate refixing period)
A period of 2 years in most cases, in which you can decide at your own discretion when you want to fix the interest rate for the new ‘rentevastperiode’ or fixed-interest period.
Rentevastperiode (Fixed-interest period)
The period during which a fixed mortgage interest rate applies. In the case of more extensive fixed-rate periods, the credit institution is likely to charge a higher interest rate.
Rentemiddeling (Interest rate averaging)
If you prematurely end your mortgage (by moving house, for example) and you take out a new mortgage with the same credit institution, the latter is generally prepared to average out the interest rate. The old and new interest rates are averaged out as a function of the duration of the fixed-interest periods.
Splitsingsakte, Splitsingsreglement, Splitsingsvergunning (Deed of partition, property division regulations, property division permit)
A deed of partition specifies how a building is divided up into different apartment rights. This allows the apartments to be sold separately. The deed is drawn up by the notary. The deed is also executed at the notary’s office.
The valuation of the house, performed by a certified real estate assessor or estate agent.
Transportakte (Deed of transfer)
This deed is drawn up by the notary when a house changes hands. It is also referred to as an ‘akte van levering’ or deed of transfer of title. The deed is filed with the Dutch Land Registration Office (Kadaster).
Variabele rente (Variable interest)
When a variable interest rate applies, the amount of interest you pay varies in line with money market developments.
Voorlopig koopcontract (Preliminary contract of sale)
This is a contract of sale that precedes the official transfer of title that is executed by a notary. In this case, ‘voorlopig’ or preliminary means that the sale can be nullified within the period of reflection of three working days, or if let-out clauses apply, such as the purchaser’s ability to arrange adequate finance.
Voorlopige belastingteruggave (Interim tax refund)
The owner of a house can request the Dutch tax authorities to reduce the amount of monthly tax he pays in anticipation of the estimated total tax refund to which he is entitled at the end of the year.
Waarborgsom (Deposit), refer also to Bankgarantie
If you purchase an existing house, the seller is entitled to demand a percentage of the purchase price as a deposit.
This deposit is paid to the notary and remains in the notary’s account until the deed of transfer has been executed by the notary. In most cases, the purchaser arranges a bank guarantee instead of paying a deposit.
Woonlasten (Housing costs)
All the costs associated with living in a house, such as the mortgage payments, insurance premiums, property tax, etc.
WOZ (Dutch Valuation of Immovable Property Act)
In full, WOZ stands for Wet Waardering onroerende zaken, or the Dutch Valuation of Immovable Property Act. The ‘WOZ-waarde’, or the value of your house according to the dictates of this Act, is determined by the municipal authorities. The value is established according to a ‘waardepeildatum’ or value reference date, which is the date on which the selling price of similar houses is measured. The ‘WOZ-waarde’ is used to determine the amount of the ‘eigenwoningforfait’ (taxable amount for home-owners), the level of property tax and the water purification tax levied by the local Dutch water board.