Reasons to refinance:

When you refinance your home loan, you exchange the old mortgage for a newer one.  There are various reasons to refinance your existing mortgage.

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/piggy-bank.svg

    Reduce monthly mortgage payments.

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/piggy-bank.svg

    Switch interest type or rates.

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/piggy-bank.svg

    Change residential mortgage to buy to let mortgage.

For example:

Current mortgage € 400.000 

  • Current interest rate: 3,25%

  • Save € 241 per month on interest

Current mortgage: € 600.000 

  • Current interest rate: 3,25%

  • Save € 315 per month on interest

Current mortgage: € 1000.000

  • Current interest rate: 3,25%

  • Save € 532 per month on interest

Why should I refinance my mortgage?

Refinancing can benefit your existing financial situation. For example, you can reduce your interest rate and monthly costs. Imagine you took a loan for 30 years with a higher interest rate. Now you can refinance your mortgage to 25 years with a lower interest rate.

How does refinancing work in the Netherlands?

When you buy a home, you apply for a residential mortgage. You sign a mortgage act at the notary to close the deal between you and the mortgage lender. The mortgage deed contains a clause that regulates the terms and conditions of your loan. When you switch mortgage lenders, you break the agreement between you and the bank. Your mortgage lender could charge you a so-called penalty for breaking the contract before the fixed term ends. Mortgage refinancing requires you to go through the application process and meet the new loan requirements.

How to refinance my home loan?
  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/Group-18.svg

    How much is my penalty?

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/Group-18.svg

    What are the current mortgage interest rates?

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/Group-18.svg

    How many closing fees do I need to pay?

  • https://dqz9c7ehtvp3z.cloudfront.net/wp-content/uploads/2021/08/Group-18.svg

    What conditions does the new mortgage lender offer?

Good to know

Penalty

  • You must pay the penalty to your mortgage lender because you decided to leave the deal earlier. The amount varies per lender because each lender offers different conditions.

Why is refinancing a bad idea?

  • First, you must pay the penalty to your mortgage lender because you decided to leave the deal before the fixed-rate term ends. If you fixed your mortgage interest rate for ten years and decide to refinance after three years, you still have seven years remaining.

    Your mortgage lender could ask you to pay the remaining interest rate back. Secondly, you must pay mortgage-related fees for your new mortgage, including an appraiser, the notary, and other mortgage closing fees. So, it would be best to weigh the pros and cons of refinancing options in the Netherlands. Do you need help? Contact us to get up-to-date information about mortgage lenders and interest rates.

Meet the team
Sezer Yilmaz
Managing Director & Financial Specialist
Egle Kemezyte
Growth Marketer
Robin Uijtdehaage
Commercial Director & Financial Specialist
Özkan Karakol
Financial Specialist