Renting a home with a residential mortgage

One of the most popular questions nowadays is: 

 ” Can I rent my home with a residential mortgage in the Netherlands? “

The answer is NO unless your mortgage lender gives you consent to rent your home for a limited time.

When you buy a home, you sign a legally binding contract with your mortgage lender. Almost every mortgage deed contains a section called the “rental clause” which means subletting property to a third party without written consent from a bank is not permitted. 

What are the consequences of renting a property without the bank’s approval?

Different banks have different laws for breaching the mortgage agreement. 

The mortgage lender has a right to sell a property through foreclosing procedure if the borrower does not comply or breaches a mortgage deed.

For example: if the borrower does not pay monthly payments or a bank finds out about tenants living in the property, a mortgage lender can demand to repay a loan in full. 

Selling a home does not mean a tenant should leave.

Tenants are well protected in the Netherlands, which means landlords have no right to force tenants to move if a property is listed for sale.

In many cases, the property’s value decreases significantly if a landlord needs to sell a property with tenants.

Banks are not interested in keeping the tenants in a property. The most likely scenario is that banks will sell a property immediately with or without the tenants.

What options do I have if I need to rent my apartment for the long term?

If your mortgage lender cannot grant you rental consent, you can refinance your loan from a residential to buy to let mortgage. In this case, you are legally allowed to rent your property.