It is important that you provide timely and comprehensive information to both potential and existing borrowers at all phases of the mortgage process. They need to know about the process, the options and about their rights and responsibilities. Use this site to keep up to date on what borrowers need to know.
What is the National Mortgage Guarantee?
The Dutch National Mortgage Guarantee scheme is unique in Europe. It helps people take out a mortgage that is affordable and responsible from the start. And if people run into problems meeting their payments due to circumstances beyond their control, the NHG provides a safety net for the borrower and for the mortgage lender.
The National Mortgage Guarantee is referred to in Dutch as ‘NHG’ or ‘Nationale Hypotheek Garantie’.
The specific circumstances under which borrowers can apply to the NHG are:
- If they lose their job
If their relationship ends
- If they become disabled for work
- If their partner dies
What are the advantages of an NHG-backed mortgage?
Safety net if people can no longer meet their mortgage payments
If the borrower’s circumstances change unexpectedly, meaning that they can no longer meet the mortgage payments, NHG provides a safety net. In these types of situations NHG may be able to help the borrower and the lender to make the mortgage affordable again. The aim is to help borrowers keep their homes and avoid being forced to sell at a loss.
Reduced risk of residual debt
If selling the home does turn out the be the only option when a borrower is facing circumstances beyond their control and if there is a residual debt on the mortgage, then NHG will waive this residual debt provided the borrower meets all the NHG requirements. In this case, having come through very difficult circumstances, the borrower can start afresh without any residual debt.
Lower interest rate
Many borrowers benefit from a lower interest rate if they take out an NHG-backed mortgage. This means that borrowers can quickly recoup the fee paid for the NHG-backed mortgage.
A feeling of security
When borrowers take out an NHG-backed mortgage they reduce the financial risks of owning their own home, whether they are applying for a new mortgage or remortgaging to fund renovations. When borrowers take out an NHG-backed mortgage they can be sure that their mortgage is responsible and affordable: an NHG-backed mortgage always matches a borrower’s income because NHG applies the criteria for responsible lending and borrowing set by the National Institute for Family Finance in the Netherlands (NIBUD).
What categories of lending are suitable for NHG-backing?
Buying a property
A borrower can apply for an NHG-backed mortgage to buy an existing or a new build property. It goes without saying that a buyer is not allowed to buy back a property that he or she previously sold with residual debt. The criteria for buying a property are listed in the Conditions & Norms. Use the Online Check (in Dutch) to find out if a mortgage applicant meets the NHG acceptance criteria. Or get a general indication of the amount that could be borrowed based on income with the Quick Acceptance Check (in Dutch).
Switching or refinancing a mortgage
If a borrower already has an NHG-backed mortgage, they can switch to another lender if desired. In certain specific cases, a borrower can switch to an NHG-backed mortgage and can apply to refinance a mortgage with NHG-backing. Use the Online Check or the Quick Acceptance Check to find out if an applicant meets the NHG acceptance criteria.
Including residual debt in a new mortgage
On certain conditions a residual debt can be included in the mortgage to buy a subsequent property. Use the Financing Residual Debt Quick Check to get an indicative calculation of the maximum NHG-backed mortgage available if the expected residual debt on the current property is included. Use the Online Check for a more detailed calculation.