How much mortgage can I get? How your borrowing capacity works

The first question almost every buyer asks is: how much can I borrow? The answer depends on several factors. By understanding how your borrowing capacity is calculated, you can search more purposefully and bid with more confidence.

Income as the basis

Your gross annual income is the most important starting point. Lenders look at your fixed income, but also at irregular allowances, a thirteenth month or holiday pay. If you're buying together, both partners' incomes are taken into account. Self-employed people usually need to show their annual figures from recent years.

Statutory standards

In the Netherlands there are statutory rules that determine the maximum share of your income you may spend on housing costs. These standards are reset every year. An adviser calculates with the current standards, so you know where you stand.

The interest rate

The higher the mortgage interest rate, the lower the amount you can usually borrow. The fixed-rate period you choose also plays a role. A longer fixed-rate period offers certainty, but may carry a slightly higher rate. Have different scenarios calculated.

The energy label counts too

For homes with a good energy label you can sometimes borrow extra, because the energy costs are lower. Extra borrowing room can also exist for sustainability measures. Read more in our article on sustainability and home value.

Debts and obligations

Do you have a student loan, a personal loan or a lease car? Those obligations affect how much you can borrow. An overdraft or credit card limit can also count. It pays to have insight into all your fixed costs beforehand.

Maximum mortgage and home value

Besides your income, the value of the home is also decisive. As a rule you cannot borrow more than the appraised market value. If you bid above the appraisal value, you must pay the difference from your own funds. That's why an independent valuation is so important. Read more in why a valuation is needed.

Own funds for buyer's costs

The buyer's costs, such as transfer tax, notary costs and advisory costs, usually cannot be co-financed. So set aside your own money for these. In our article on buyer's costs you'll find an overview.

Being able to is not the same as wanting to

What you can borrow at most isn't always what's wise. Also think about your future plans: working less, children, or a renovation. A good adviser looks together with you at what fits your life, not just at what's allowed.

Immediate clarity

Want to know how much you can borrow? Plan a conversation via our mortgage advice. With a clear budget you can search purposefully in the property listings and have your buying agent search along with you. Get in touch for an appointment.

Repayment types

The way you repay affects your monthly costs. With an annuity mortgage you pay roughly the same gross amount each month, with the repayment share slowly growing. With a linear mortgage you repay the same amount each month, so monthly costs start higher and then decrease. To qualify for mortgage interest deduction you generally need to fully repay within thirty years.

National Mortgage Guarantee

For homes up to a certain price threshold, you can take out a mortgage with National Mortgage Guarantee (NHG). This provides security if circumstances mean you can no longer pay your mortgage. With NHG you often also get a lower interest rate. The threshold is reset every year. An adviser can tell you whether NHG is worthwhile for your situation.

Starting without an existing home

Buying for the first time? Then you have no equity from a previous home. The own funds for the buyer's costs then need to come from savings, or for example a gift from parents. Rules apply here too. Get properly informed about what's possible and the consequences of a gift or loan from family. Also read our step-by-step plan for your first home, where we describe the whole process for first-time buyers.

What's a good buffer?

Besides the buyer's costs, it's wise to keep a financial buffer for unexpected expenses, such as a broken boiler or small maintenance after moving in. A buffer provides peace of mind in the first period in your new home.