Maybe you want to cross the mortgage because you want lower monthly payments, because the fixed-rate period ends or because you plan to renovate. Whatever the reason, first talk to a mortgage advisor. The adviser will examine together with you whether it is wise to transfer the mortgage. It is not always a good choice and in some cases it can even result in a fine. Ask for an introductory mortgage interview with a mortgage advisor, so that you can make an informed choice.
Expiry of the fixed-rate period
If the fixed-rate period ends, your mortgage lender has to make a new interest offer three months in advance. If you find a better offer elsewhere, you can choose to switch to another provider. Your mortgage lender may not give a fine, but you can be confronted with other costs. With some mortgage lenders you can use the interest of the current interest rate period: the interest you have secured is then averaged with the interest that applies at that time. This can give you an advantage when the interest rate is lower than the interest you have secured. If you can arrange this with your mortgage lender, you will only pay administration costs.
Same mortgage form with other mortgage lender
Do you want to keep the same mortgage form, but do you want to switch to another mortgage provider? You can and you can still use the mortgage interest deduction. If you opted for an interest-only mortgage at that time , you can transfer it to another mortgage provider, without your mortgage interest deduction being canceled. However, the interest-only mortgage may not be more than fifty percent of the market value of the home. If it is higher, you have to opt for a mortgage for that part of the mortgage. Of course, the new mortgage lender will assess whether they can offer you the mortgage. If it is that the home is worth less than the mortgage, they can reject the application. In general, it is not advisable to switch mortgage lenders if you have a ( bank ) savings mortgage . Your gross monthly costs will remain the same, which will not benefit you.
Note: If you switch from mortgage lender, this usually involves costs and in some cases a fine. So let yourself be well informed in advance.
Change mortgage form
Different rules apply to the conversion of the mortgage type. Do you want to convert the mortgage and continue to use the mortgage interest deduction? Then you can only choose a form where you pay off: a linear or annuities mortgage . Because this changes your personal situation, it is wise to first seek advice from a mortgage advisor. You can explain all the advantages and disadvantages and see whether it is wise to switch to a different form of mortgage.
Penalty due to mortgage transfer
Do you transfer the mortgage during the fixed-rate period? Then the mortgage lender can give you a fine. In some cases that is fine, because it may be that the new monthly costs are so much lower that the fine is quickly recovered. To determine the amount of the fine, the mortgage lender looks at the interest rate that applies at that time and for how long the term of your mortgage is still. In addition, the amount of the costs of advice, valuation costs, mortgage costs and any costs for National Mortgage Guarantee are included in the amount of the fine. You may have to borrow extra money for this. You can not deduct interest on the extra borrowed part. If you do not loan extra for this, these costs are deductible.