Step 4 continued

Banks issue loans on the basis of three principal indicators:

1. A personal assessment
► BKR assessment
This assessment examines the extent to which the person concerned has met his financial obligations in the past. A register for this purpose is kept at the Credit Registration Office (BKR)

► Nationality
The applicant's country of origin forms an important assessment criterion for banks (distinction between within or outside of the EU).

► Tax status
Verifies whether the applicant is a taxpayer in the Netherlands and/or the 30% ruling applies.

2. Mortgaged property assessment
The value under foreclosure of the mortgaged property to be financed forms an important aspect of this. The average value is between 85 and 90% of the open market value. As a rule, the bank will not be willing to finance more than 125% of the value under foreclosure. Having 125% of the value under foreclosure financed provides you with the purchase amount + additional costs, the kosten koper costs (purchasing costs payable by the purchaser)

3. Assessment of your financial position
The bank will want to make certain that the applicant can afford to keep up the mortgage payments. Banks assess this on the basis of various woonquotes (home expenses quotes), which determine the part of the household income that can be spent on accommodation. Different banks operate different woonquotes, which are based on the level of income.
If a client has private capital that is included as a factor in the bank's assessment and will usually create additional sources of financing.

The interest rate operated by the bank depends on:
► The ratio between the value under foreclosure and the amount of the mortgage loan. The amount that can be borrowed is related to the value under foreclosure of the home. The interest margin required by the bank to cover the risk increases in keeping with the percentage of that ratio.
► The period for which the interest rate is fixed. The interest margin charged by the bank increases in keeping with the length of the fixed interest period.
► Does the National Mortgage Guarantee apply yes/no