Many homebuyers may need to know that they can move their mortgage from one lender to another, from one borrower to another, or from one property to another.

Transferring or porting the mortgage is a common choice for many homeowners who want to save on interest costs or access better products and services. This blog delves into transferring mortgages in the Netherlands, providing an overview of what you can anticipate. Whether you are looking for a better interest rate elsewhere or aiming to use the same mortgage for a new home, we've got you covered.

Moving mortgage to a new home

When you move, you can take your current mortgage conditions, including the interest rate and terms, to your new home. Instead of getting a new mortgage, you use the money from selling your house to pay off your current mortgage. Then, you gain a new mortgage with the same terms to buy your new home.

Benefits of taking your current mortgage to a new home

Bridging loans provides important benefits when transitioning homes. They reduce pressure to quickly sell the current home since funds are available independently for the new purchase. A bridging loan also enables using existing home equity as part of the down payment on the next property, fulfilling interim financing needs before the sale of your current or previous home closes. Most significantly, it serves as temporary funding until the sale proceeds from the original residence, which will immediately pay off the bridging loan balance.

Potential risks of a bridging loan

Bridging loans are not without potential risks. During the bridging period, monthly housing costs increase as the homeowner makes payments on three loans: the existing mortgage, the new mortgage, and the bridging loan. Lenders each have underwriting standards, and some may require selling the original home within 6-24 months. Additionally, bridging loans tend to carry higher interest rates than standard mortgages due to their short-term nature. Borrowers should consider these conditions against the bridging loan's value as temporary financing when transitioning between properties.

Transfer a mortgage to a lower interest rate

Moving your mortgage provides a wider choice of products versus staying with a single lender. Rates vary across banks, so comparing options through an independent advisor helps identify the most cost-effective option for your short- and long-term needs and budget.

Sometimes, if you leave your bank deal early when the interest rate is fixed, they might charge you a fee. But only sometimes! You won't get charged if you renew the agreement after the fixed period or sell your property. Refinancing could save you money in the long run, even with the fee, because you pay less interest over time.

What are the benefits of switching mortgage lenders?

Refinancing your mortgage to another lender could benefit you in key circumstances.

Lowering your monthly payments by taking advantage of reduced interest rates is one reason to consider switching banks.
Another is accessing extra funds, such as for home renovations, through cashing out home equity as part of refinancing.
The expiration of a fixed rate period also opens the door to securing a new rate.