Steps to Buy: 03
What is NHG?
The Nationale Hypotheek Garantie (NHG) is one of the most important concepts for first-time buyers in the Netherlands.
The Safety Net
NHG acts as an insurance policy for your mortgage. If you can no longer pay your mortgage due to uncontrollable circumstances (involuntary unemployment, divorce, disability, or death of a partner) and your house must be sold for less than the remaining mortgage debt, the NHG fund steps in and covers the residual debt.
This dramatically reduces the risk for the lender (the bank).
The Reward
Because the bank faces almost no risk...
Lower Interest Rate!
Usually a 0.5% discount
The Limits & Costs
| Rule | Details |
|---|---|
| Maximum Purchase Price | €470,000 |
| With Energy-Saving Measures | €498,200 (6% higher) |
| The Premium (One-time cost) | 0.4% of the mortgage amount |
Although you pay a 0.4% premium upfront during the notary transfer, the interest rate discount you receive from your bank typically pays for this premium within 2 to 3 years. It is highly recommended to get NHG if you are buying under the limit.