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Increasing your mortgage for renovations
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Renovating your home allows you to improve your living comfort. Due to high energy prices, it is advisable to also look into options for making your home more sustainable at the same time. By combining renovation and sustainability upgrades, you can increase your living enjoyment while saving significantly on energy costs. You can finance the renovation and sustainability upgrades affordably through your mortgage.
With a second mortgage, you can finance the renovation at a low interest rate. You will need to visit the notary again for this mortgage. We are happy to help you arrange a second mortgage. Together with you, we will look for the lender offering a mortgage with the best conditions and low monthly payments.
Taking out a second mortgage to increase your mortgage
You opt for a second mortgage if you have equity in your home. Lenders are willing to lend you an additional amount using the house as collateral. As a result, you pay a lower interest rate compared to, for example, a personal loan or a revolving credit facility. The amount made available by the second mortgage is placed in a construction deposit. You can use this deposit to finance renovations to your home or to make your home more sustainable.
We would be happy to answer these questions in a personal meeting
What should I look out for?
Increasing your mortgage for a renovation often raises a number of questions:
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How much extra can I borrow for my plans?
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Do I need to go back to the notary or appraiser?
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What does this mean for my monthly expenses?
In a personal meeting, we would be happy to explain it to you step by step – so that you know exactly where you stand.
Often, more is possible than you think
We have already had the privilege of helping many people. In doing so, we always provide tailor-made solutions for every unique situation. We specialize in the following special situations:
- Medical resident
- PhD candidate / researcher
- Starting entrepreneurs
- Family bank mortgage
- Generation mortgage
- Guarantee and co-debtorship
- Starter loan
- From renting to buying
Let us know if you would like to know more about the matters mentioned above; we are happy to help.
Calculate it yourself
Would you like an indication of the possibilities? Use the tool below: Please note: the tool is indicative. Sometimes more is possible than you think. Het Florijnhuys provides custom solutions. We would be happy to tell you more.
Interested in a no-obligation introduction?
You can always get to know us in an informal, no-obligation way. This can take place at our office, at your home, or at your business. Meeting by phone or online via video call is also possible.
During a free consultation, we can discuss the feasibility of your wishes together. We can also provide an initial indication of the maximum mortgage and the associated monthly payments.
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The Florijnhuys is happy to help you!
Looking for financial advice for your own home or investment property? Call 050 – 211 08 52 or fill out our contact form via the button below.
How does a second mortgage for renovation or sustainability improvements work?
A second mortgage is an additional loan alongside the existing mortgage. It may not be advisable to take out a second mortgage; instead, you may need to break open the existing mortgage and transfer both the existing mortgage and the new loan into a new mortgage. In both cases, we apply for a new mortgage. The lender will therefore request employer statements, and an appointment will be made with the notary to register the mortgage on the house. Naturally, we handle the entire process for you.
Once the mortgage has been arranged, the additional amount for the renovation is placed in an escrow account. You can then pay the contractor's bills from the escrow account. As soon as you withdraw money from the escrow account, you will also pay mortgage charges on it.
Due to high energy costs, renovations are often combined with making the home more energy-efficient. This can be done by opting for, for example, a heat pump and solar panels, and by properly insulating the house. We recommend combining these works as well, because applying for an additional mortgage later on results in extra costs.
Tips for financing a renovation or making a home more sustainable
- Get advice on refinancing the mortgage
- Seek advice from an energy expert before investing in sustainability. After all, you want the highest return on your invested euros
- Take rising inflation into account. It is better to take out a larger second mortgage
- Do you want to keep the costs of the second mortgage as low as possible? Choosing an interest-only mortgage is an option
- Combine multiple renovations to avoid incurring costs for taking out a second mortgage more frequently
- Don't forget to apply for a subsidy
- Solar panels are for sale without VAT as of January 1, 2023
A construction deposit for renovating and making your home more energy-efficient
You align the amount of the additional mortgage with the investments listed in the contractor's quotation. The loan amount is deposited into a construction escrow account. The invoices for the renovation are charged directly to the construction escrow account. Even if you advance costs yourself, you can offset these amounts against the escrow account. You pay interest on the amount withdrawn. If money remains after the renovation and sustainability improvements, the remaining amount is used to pay off the mortgage debt.
Subject to conditions, you are entitled to a subsidy for making your home more sustainable. You can read more about this on the Central Government.
Increase mortgage privately
When buying a house, you can opt for an increased registration at the notary. This means that you have the notary record in advance that you can place a higher mortgage debt on the house. The advantage of this is that you do not need to go to the notary for the increased amount if you need an additional mortgage. However, to increase your mortgage privately, you must remain with the same lender. Therefore, you must take out the additional mortgage with the same bank.
Increasing the mortgage for a kitchen
With equity in your home, you can, for example, take out a second mortgage to install a new kitchen. However, it is important to also consider at the same time whether you have any other wishes. It might be wise to borrow an additional amount right away for insulation, installing a heat pump, and solar panels.
Raising the mortgage for the garden
Did you know that you can also take out a mortgage to landscape a garden? After all, your garden is also part of your assets. Landscaping or furnishing a garden is expensive, but with a second mortgage, you can co-finance the costs within the mortgage at low monthly payments. Under certain conditions, the mortgage interest paid is also tax-deductible.
More information about increasing your mortgage or applying for a construction deposit?
We would be happy to walk you through what you need to know about a construction deposit:
- A construction deposit has a maximum term of two years
- With the amount remaining in the house after the renovation, you reduce the mortgage debt
- Financing a renovation with a construction deposit may be mandatory
- It is better to keep an extra amount on hand. This way, you avoid a shortage
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Helpful tips
Are you looking for a mortgage with the lowest monthly payments for the purchase of your own home? Or are you looking for a buy-to-let mortgage for the purchase of an investment property?
Frequently asked questions about buying a house
The additional mortgage amount you can borrow for a renovation depends on two factors. First, the maximum mortgage depends on the level of your income and certain fixed expenses. According to the lender, the mortgage payments must be affordable for you. Second, the maximum additional mortgage also depends on the value of the house. You must have sufficient equity in the house.
When taking out a second mortgage, you also incur advisory and brokerage fees and must visit the notary again. Additionally, the lender may require a valuation. You can expect costs ranging from €3,500 to €5,000.
When taking out a second mortgage, you also incur advisory and brokerage fees and must visit the notary again. Additionally, the lender may require a valuation. You can expect costs ranging from €3,500 to €5,000.
You can get a higher mortgage if you invest money in making your home more sustainable. Homebuyers are allowed to finance a maximum of 100% of the purchase price. A mortgage of up to 106% of the value of the house is possible if the amount exceeding the purchase price is used for sustainability improvements.
The costs of making a home more sustainable depend on what needs to be done. For an older home, you should expect to pay tens of thousands of euros for insulating the house and installing, for example, solar panels and a heat pump. You can recover part of the investment through subsidies you may be eligible for.
You can use a second mortgage to pay for solar panels on your roof. The savings on energy costs may allow you to fully offset the mortgage payments. As of 2023, you no longer pay VAT on solar panels.
