The renteopslag (interest rate surcharge): we've all heard of it. But what is it again? When granting a mortgage, the mortgage lender runs the risk of not getting its money back. The lender wants to keep that risk as small as possible. They try to do this through an interest rate surcharge. The surcharge is a mark-up on the standard interest rate. It depends on the value of the home relative to the mortgage loan.
Rising house prices
Rising house prices improve the value of the home relative to the mortgage amount. The bank will reward this by dropping the interest rate surcharge. However, you do have to show that the value really has improved that much. In this way, even as a homeowner with no plans to move, you benefit from rising house prices. During the crisis, especially in 2012/2013/2014, homes were generally half or a third cheaper than they are now.
Interest rate surcharge
Have you paid off a little of your mortgage every month, and has your home become worth a lot more? Then it may well be that you're under the 67.5% threshold. In many cases, that means your interest rate can be lowered by 0.5% without a penalty or remortgaging. That's serious money. It can add up to thousands of euros a year. However, it's also possible at 90% of market value. At that point there are already interest rate discounts too.
Worked example:
In 2016 you bought a nice family home in the Daalsebuurt for around €275,000, and you took out a mortgage of €275,000 on it. This nice 65 m2 terraced house is now worth not €275,000 but €425,000. That's a huge difference in value. So €275,000/€425,000 * 100 = 64.7%.
Market value
To establish this market value, you need substantiation of the value. This can be done with a valuation report. Curious whether this would be worthwhile for you? Then feel free to give me a call, and together we'll look at whether a valuation report makes sense. It could easily save you thousands of euros a year. That's a nice bonus, isn't it? Curious what else the rise in value could mean for you? We can always have a call.
