In the Netherlands, starters who want to buy a home can apply for a start-up loan. The borrowing standards have become stricter since 2013. Taking out a mortgage for a first home is no longer so simple. As a starting home owner, you can only finance the house price from 2018 onwards.
You have to pay for everything around it yourself. In addition, the bank also monitors the type of employment, the level of your income and your age when assessing a mortgage application. Young buyers and starters can therefore often not borrow sufficiently. With the start-up loan you will receive a supplement to the mortgage from the municipality. And you do not have to pay redemption and interest in the first 3 years.
What is a start-up loan?
But what exactly is a start-up loan? How does it work and what conditions must you meet so that you are entitled to this special loan? We explain everything to you at Leningen.nl. The Starter Loan is a special type of loan that is only provided to and through municipalities where starters purchase a home.
They often can not borrow enough money from the bank. The start-up loan can then act as a supplement to the maximum mortgage loan amount, so that up to 100% of the purchase value can be financed. Many municipalities offer loans to starters.
The foundation Stimuleringsfonds Volkshuisvesting
However, not every municipality offers buyers the opportunity to borrow extra money cheaply. The foundation Stimuleringsfonds Volkshuisvesting Nederlandse Gemeenten (SVG) provides the complete execution of the loans. You do not have to pay interest on this special municipal loan during the first three years.
Loan for starters as a supplement to mortgage
The reason why starters in the housing market often can not buy a house is because their income is sometimes inadequate. The bank then provides them with insufficient mortgage. The rest can be supplemented with a loan for starters via the municipality. With the start-up loan, the difference between the purchase price of the house and the maximum mortgage can be bridged.
Further on this page you can read what your maximum start-up loan is and how you can calculate it. The amount that you can borrow from the municipality depends on your income, savings and the purchase price of the home.
Do you have a chance of a starting loan?
With a start-up loan you make a start on the housing market. Are you eligible? That is different for each municipality. You can check whether you meet the conditions on the website of your municipality or on the website of the Stimuleringsfonds Volkshuisvesting Nederlandse Gemeenten (SVG) Foundation. Most municipalities apply at least the following general start-up loan conditions:
- The loan can only be applied for new construction or existing construction.
- You are registered with the municipality (at least 1 year).
- The amount that you can borrow is maximized to a maximum percentage of the purchase price.
- There is an age limit.
- Your income must be sufficient.
The benefits of a starters’ credit
A starters’ credit for first homeowners has many advantages. The loan itself, incidentally, consists of 2 parts and a part that has to be repaid (annuitary); the start-up loan itself. And a part that increases; a combination loan. You do not have to pay a repayment in the first three years as a starter. You also do not have to pay interest on your lending amount for the first three years! For example, during the first few years, you do not have to pay any high costs as a starter.
Calculate your starters loan
A start-up loan always asks you at the municipality where you buy a house. Not every municipality provides start-up loans. You can calculate your maximum start-up loan on the SVn website. Go to the “Starter Loan Calculator” page.
You fill in some questions and data in the loan calculator. State, among other things, what you are requesting the loan for, what the purchase price is of the house you want to buy and fill in details regarding your gross annual income. The entire implementation / settlement of the start-up loan is done by the Stichting Stimuleringsfonds Volkshuisvesting Nederlandse Gemeenten (SVG).
Request start-up loan from your own municipality
You do register for the starters credit with your own municipality. They then provide you with an application set so that you can apply for the loan with the SVn.
When will you be told how much you can borrow?
As we already wrote, the implementation is done by the SVn. They assess your application. You first have to provide the necessary documents for this. These documents are first assessed before the application is processed further. The SVn takes into account the conditions that your own municipality sets with regard to the start-up loan. If everything is agreed, the foundation will send the outcome of the assessment to your municipality.
The municipality itself then makes a decision. When will you be told how much money you can borrow as a starter? Most municipalities usually decide within two weeks whether you are eligible for a starter mortgage. You will automatically receive a rejection letter or an assignment letter.
Quotation and the way to the notary
Do you meet all conditions and your income is sufficient, so that you can repay the loan in the future? Then you will receive an offer from SVn. You will also receive a detailed explanation and the general provisions for mortgage loans. An information sheet is also sent with the other documents, namely the ‘European Standard Information Sheet’ (ESIS).
You agree with the conditions and sign the offer. You send that quotation back to SVn. They then prepare the tender and send it to the civil-law notary who has provided you within a few days. You will be notified when the notary has received the papers.
Visiting the notary
You then make an appointment with your notary. With him, the passing of the deeds takes place. The notary will then make a settlement note and send it to the SVn. The amount of the start-up loan is then transferred to your notary, after which the deed for your mortgage and for the start-up loan are passed at the same time.
How much interest loan for starters?
On the website SVn.nl you can find out the costs of your start-up loan. A fixed application fee will be charged per application. In 2017 this amount was 750 euros.
In addition, you also pay an interest payment after 3 years. The level of the interest on start-up loans is set by the SVn and for this they apply fixed interest rates published by lenders for interest rates for 10 years on mortgage loans. For start-up loans, a fixed interest rate of a maximum of 15 years always applies during the term.