The number of new mortgages in the Netherlands taken out with a National Mortgage Guarantee (NHG) rose 12 percent in the first quarter of the year compared to 2019. The total was 28,900 households that received a guarantee from the NHG, which was created to provide a safety net in case people lost the ability to make payments.
In effect, owners are left with no residual debt if they default and their house has to be sold in return for a one-off payment at the beginning of the loan. The arrangement allows banks to offer lower interest rates, but only for homes worth less than €310,000. In the Q1, the total value of assets covered by such guarantees rose 1.7 percent to €1.46bn compared to the end of 2019.
