Choosing the right mortgage is one of the most important steps in buying a home — especially in the Netherlands, where the mortgage landscape includes a variety of options tailored to different financial situations. Whether you’re a Dutch citizen or an international looking to settle down, understanding the types of mortgages in the Netherlands will help you make smart, future-proof decisions.
In this blog, we’ll explain the most common Dutch mortgage types, highlight their pros and cons, and help you figure out which one might be best for your needs.
1. Annuity Mortgage (Annuïteitenhypotheek)
The annuity mortgage is one of the most popular choices in the Netherlands, especially among first-time buyers.
How It Works:
You pay a fixed monthly amount, which includes both interest and principal. Early in the mortgage term, you’ll mostly pay interest. Over time, more of your payment goes toward repaying the loan.
Pros:
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Predictable monthly costs (ideal for budgeting).
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Eligible for mortgage interest tax deduction if it’s your primary residence.
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Full repayment within 30 years.
Cons:
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You build equity more slowly in the beginning.
Best For:
Buyers who want stable payments and plan to stay in the home long-term.
2. Linear Mortgage (Lineaire Hypotheek)
With a linear mortgage, you repay the same amount of the principal every month, plus interest on the remaining balance.
How It Works:
Monthly payments start high but gradually decrease as the interest portion declines.
Pros:
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Faster loan repayment.
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Less total interest paid over time.
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Eligible for mortgage interest deduction.
Cons:
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Higher initial monthly payments can be a burden.
Best For:
People with a strong financial position and those who want to minimize interest costs.
3. Interest-Only Mortgage (Aflossingsvrije Hypotheek)
This type of mortgage allows you to pay only interest during the mortgage term. The loan principal is repaid in full at the end of the term — or when you sell the home.
How It Works:
You make interest-only payments for the duration of the loan. You’re expected to repay the full principal at the end.
Pros:
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Lowest monthly payments.
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More financial flexibility.
Cons:
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Not eligible for tax deductions on new mortgages (since 2013).
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You must repay the full loan later, which can be risky without proper planning.
Best For:
Buyers with significant savings, other investments, or those nearing retirement who don’t want to tie up their cash.
4. Bank Savings Mortgage (Bankspaarhypotheek) (Only for existing mortgages)
While this option is no longer available for new mortgages since 2013, it’s still relevant for people who already have one.
How It Works:
You pay interest and save in a linked savings account. At the end of the term, the savings are used to pay off the mortgage.
Pros:
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Tax-efficient savings.
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Predictable long-term costs.
Cons:
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Less flexible than modern options.
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Only available if you already had one before 2013.
Additional Factors to Consider
Fixed vs. Variable Interest Rate
You can choose a fixed rate (for 1 to 30 years) or a variable rate that changes with market conditions. Fixed-rate mortgages offer certainty, while variable rates can be cheaper in the short term but riskier long-term.
NHG – National Mortgage Guarantee
If your mortgage is under a certain threshold (€435,000 in 2025), you might qualify for NHG (Nationale Hypotheek Garantie). This offers protection in case you can’t pay your mortgage due to unforeseen circumstances — and often lowers your interest rate.
Mortgage Interest Deduction (Hypotheekrenteaftrek)
If the home is your primary residence, and you're repaying the loan over 30 years, you can deduct the mortgage interest from your taxable income — a big financial benefit in the Netherlands.
- The mortgage usually can be moved to another house with the same conditions (it has to be your main residence).
- You can get a mortgage for 100% of the value of the house.
- Usually you can repay the mortgage for up to X amount per year.
- Usually you can reduce your interest rate if the house value has increased. See how here (write new blog).
Tips for Applying for a Dutch Mortgage
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You don’t need to be a Dutch citizen to get a mortgage, but most banks require you to be a resident with a BSN (citizen service number).
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Income and employment stability are key. If you do not have a permanent contract you can ask your employer for a letter that they plan to provide you with a permanent one.This helps a lot for getting an approval from the bank.
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You can work with an independent mortgage advisor (hypotheekadviseur) or find a mortgage provider by your self. A mortage advisor costs between 2000 and 4000 euros and the costs (check this) are tax deductible. They usually save you time and can find you a good deal.
Which Mortgage Is Right for You?
The best mortgage in the Netherlands depends on your financial situation, long-term goals, and risk tolerance. If you value stable monthly payments, an annuity mortgage is probably the right fit. If you can handle higher payments early on and want to save on interest, a linear mortgage might be better. And if you're an investor or nearing retirement, an interest-only mortgage can offer flexibility — with careful planning.
Before committing, always get professional advice and compare offers from different lenders. Mortgage brokers can often access better deals than banks directly.