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The Dutch National Mortgage Guarantee (NHG) is a government-backed scheme that protects both homebuyers and lenders from financial risk when borrowers cannot pay their mortgage due to circumstances beyond their control. This safety net covers properties up to €450,000 in 2025 and is managed by the Homeownership Guarantee Fund (WEW), offering lower interest rates and protection from residual debt for qualifying homebuyers in the Netherlands residential market.
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The NHG mortgage guarantee in the Netherlands offers homebuyers protection from residual debt and lower interest rates for properties up to €450,000 in 2025. The scheme requires a one-time fee of 0.4% of the mortgage amount and covers defaults due to unemployment, divorce, disability, or death of a partner.
This government-backed program provides significant financial benefits but comes with strict eligibility requirements and restrictions that potential homebuyers should understand before applying.
| NHG Feature | Details | 2025 Values |
|---|---|---|
| Maximum Property Price | Standard limit for NHG eligibility | €450,000 (€477,000 with energy measures) |
| One-time Fee | Percentage of total mortgage amount | 0.4% of mortgage (tax-deductible) |
| Interest Rate Benefit | Typical discount vs non-NHG mortgages | 0.3% to 0.5% lower rates |
| Coverage | Protection against residual debt | Up to 100% of shortfall after forced sale |
| Eligible Situations | Covered default circumstances | Unemployment, divorce, disability, death |
| Property Type | Allowed under NHG scheme | Primary residence only (no buy-to-let) |
| Manager | Organization overseeing NHG | Homeownership Guarantee Fund (WEW) |
What exactly is the NHG mortgage guarantee in the Netherlands and who manages it
The Dutch National Mortgage Guarantee (NHG) is a government-backed financial safety net that protects homebuyers and lenders when borrowers cannot pay their mortgage due to circumstances beyond their control.
The scheme is managed by the Stichting Waarborgfonds Eigen Woningen (WEW), also known as the Homeownership Guarantee Fund, which is a central Dutch foundation established specifically for this purpose. This organization oversees all NHG applications, claims, and policy decisions across the Netherlands residential property market.
The NHG operates as a guarantee scheme where the government essentially backs your mortgage, providing protection if you face financial difficulties due to covered circumstances like job loss, divorce, disability, or death of a partner. Unlike private insurance, this is a state-sponsored program designed to make homeownership more accessible and secure for Dutch residents.
As of September 2025, the WEW continues to administer the program under strict guidelines that ensure the scheme remains financially sustainable while providing meaningful protection to homebuyers in the Netherlands housing market.
Who is eligible to apply for an NHG-backed mortgage right now
NHG eligibility is available to both Dutch nationals and foreign nationals who meet specific residence and income requirements as of September 2025.
Foreign nationals typically need a valid permanent residence permit to qualify for NHG, though some exceptions may apply depending on your specific circumstances and the lender's policies. The property must serve as your primary residence, which means buy-to-let investors and second-home buyers are automatically excluded from the program.
You can apply for NHG when purchasing new-build homes, existing properties, or when taking out significant renovation mortgages. The scheme covers both apartments and houses, as long as they fall within the price limits and meet the primary residence requirement.
Income eligibility follows the responsible lending standards set by NIBUD (Dutch National Institute for Family Finance Information), which means lenders will assess your ability to afford monthly payments while maintaining adequate living expenses. This includes reviewing your current income, existing debts, and financial stability.
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What is the maximum house purchase price in 2025 to qualify for NHG
The maximum property price for NHG eligibility in 2025 is €450,000 for standard purchases.
If you include energy-saving measures in your mortgage, this limit increases to €477,000, providing an additional €27,000 allowance for sustainable home improvements. These energy measures must be verified and included in the mortgage application to qualify for the higher threshold.
This price cap applies to the total purchase price of the property, not just the mortgage amount. If you find a house priced at €455,000, for example, you would not qualify for NHG even if you plan to make a large down payment that brings your mortgage below €450,000.
The NHG limits are reviewed annually and typically adjust based on average house prices in the Netherlands residential market. These thresholds ensure the scheme remains accessible to middle-income buyers while maintaining financial sustainability for the guarantee fund.
What percentage of the mortgage costs does NHG actually cover if I default
NHG can cover up to 100% of the residual debt that remains after a forced sale of your property, provided your default qualifies under covered circumstances.
The coverage includes the outstanding principal amount, unpaid interest, and certain disposal costs associated with the forced sale. However, since 2014, mortgage lenders must share up to 10% of any loss with the NHG fund, which helps maintain the scheme's financial stability.
This protection only applies when you default due to circumstances beyond your control, such as unemployment, divorce, long-term disability, or death of a partner. The NHG will investigate your situation to ensure the default qualifies under their guidelines before providing coverage.
If your house sells for less than the outstanding mortgage balance and your circumstances qualify, NHG will cover the shortfall, preventing you from carrying residual debt that could impact your financial future. This protection makes NHG particularly valuable in volatile property markets where forced sales might result in significant losses.
How much is the one-time NHG fee I have to pay in 2025 and how is it calculated
The NHG fee in 2025 is 0.4% of your total mortgage amount, paid as a one-time charge when you take out the loan.
| Mortgage Amount | NHG Fee (0.4%) | Monthly Impact |
|---|---|---|
| €300,000 | €1,200 | €4.00 (over 30 years) |
| €350,000 | €1,400 | €4.67 (over 30 years) |
| €400,000 | €1,600 | €5.33 (over 30 years) |
| €450,000 (maximum) | €1,800 | €6.00 (over 30 years) |
| €477,000 (with energy measures) | €1,908 | €6.36 (over 30 years) |
This fee is tax-deductible under Dutch tax law, which means you can claim it as a deduction on your annual tax return. The deductibility helps offset the upfront cost and makes the NHG more affordable for qualifying homebuyers.
Most borrowers add the NHG fee to their mortgage amount rather than paying it separately, which spreads the cost over the life of the loan. This approach typically results in monthly payments of just a few euros for the guarantee coverage.
What income and debt requirements do I need to meet to get NHG approval
NHG approval requires meeting the responsible lending standards established by NIBUD, which assess your ability to manage mortgage payments alongside your living expenses.
Lenders will evaluate your gross annual income, including salary, bonuses, and other regular income sources, to determine your maximum borrowing capacity. They typically use a debt-to-income ratio that ensures your total monthly debt payments, including the proposed mortgage, don't exceed a certain percentage of your gross monthly income.
Your existing debts play a crucial role in the approval process, including credit card balances, personal loans, car financing, and any other recurring financial obligations. The lender will calculate your disposable income after accounting for these debts and essential living costs.
Employment stability is another key factor, with lenders preferring applicants who have steady employment history and secure income prospects. Self-employed individuals can qualify but may need to provide additional documentation, including tax returns and business financial statements covering multiple years.
The assessment also considers your age, family situation, and potential changes in income over the mortgage term to ensure long-term affordability of the loan payments.
What are the main advantages of taking a mortgage with NHG compared to without it
NHG mortgages typically offer interest rates that are 0.3% to 0.5% lower than comparable non-NHG mortgages, which can save thousands of euros over the loan term.
1. **Lower Interest Rates**: Banks offer reduced rates because the government guarantee reduces their risk exposure 2. **Residual Debt Protection**: Complete protection from remaining debt after forced sales due to covered circumstances 3. **Tax Benefits**: The NHG fee is fully tax-deductible, reducing the effective cost of the guarantee 4. **Payment Flexibility**: Access to mortgage payment facilities that allow temporary payment deferrals during financial hardship 5. **Peace of Mind**: Government backing provides security for both borrowers and their families in case of unexpected life eventsThe interest rate savings alone often exceed the cost of the NHG fee within the first few years of the mortgage. For a €400,000 mortgage with a 0.4% rate reduction, you would save approximately €1,600 annually in interest payments, quickly offsetting the €1,600 NHG fee.
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Are there any downsides or restrictions when choosing NHG that I should know about
NHG comes with several restrictions that limit your flexibility as a property owner, particularly regarding how you use the property.
The most significant restriction is that the property must remain your primary residence throughout the mortgage term. If you decide to rent out the property or use it as a second home, you will lose NHG coverage, which could affect your mortgage terms and leave you without residual debt protection.
Properties above the NHG price limits are automatically excluded, which means buyers looking at higher-end properties in expensive areas like Amsterdam or The Hague cannot access the scheme. This restriction particularly impacts buyers in the luxury segment of the Netherlands residential market.
The one-time fee creates an upfront cost that some buyers prefer to avoid, even though it's typically offset by interest rate savings. Additionally, if you use NHG coverage due to a qualified default, it may negatively impact your future borrowing capacity and credit rating for several years.
When refinancing or moving house, you cannot transfer your existing NHG guarantee to a new mortgage, requiring a fresh application and fee payment for continued coverage.
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What happens in practice if I can no longer pay my NHG-backed mortgage
When you face difficulty paying your NHG-backed mortgage, the process begins with your lender and NHG working together to find solutions before considering foreclosure.
The first step involves contacting your mortgage provider to discuss your situation and explore alternatives such as temporary payment holidays, reduced monthly payments, or restructuring the loan terms. NHG supports these flexibility measures to help borrowers through temporary financial difficulties.
If these solutions prove insufficient and a forced sale becomes necessary, NHG will investigate whether your circumstances qualify under covered reasons like unemployment, divorce, disability, or death of a partner. This investigation process typically takes several weeks and requires documentation proving your situation.
Once the property is sold, if the sale price is less than the outstanding mortgage balance, NHG will cover the residual debt provided your default qualified under their guidelines. This protection prevents you from carrying the debt burden and allows you to start fresh financially.
The entire process can take several months from initial payment difficulties to final debt resolution, during which you'll work closely with both your lender and NHG representatives to navigate the situation.
Does NHG cover situations like divorce, unemployment, or forced sale of the house
NHG specifically covers defaults resulting from divorce, unemployment, work-related disability, and death of a partner, which are considered circumstances beyond your control.
Unemployment coverage applies when you lose your job involuntarily and cannot find replacement income sufficient to maintain mortgage payments. The scheme recognizes that job loss in today's economy often occurs through company restructuring, economic downturns, or industry changes rather than personal fault.
Divorce protection activates when relationship breakdown leads to financial inability to maintain the mortgage, often because dual income becomes single income or because property division creates financial strain. This coverage acknowledges that divorce frequently creates unexpected financial burdens for both parties.
Long-term disability or illness that prevents you from working and earning your previous income also qualifies for NHG protection, provided medical documentation supports your inability to maintain employment and mortgage payments.
However, NHG does not cover voluntary job changes, early retirement by choice, or situations where you deliberately choose to sell the property without qualifying financial hardship. The scheme specifically excludes willful neglect or voluntary decisions that lead to payment difficulties.
How does NHG influence the mortgage interest rates banks offer in the Netherlands
NHG significantly reduces mortgage interest rates because it eliminates most risk for lenders, allowing them to offer more competitive pricing to qualified borrowers.
Banks typically provide interest rate discounts of 0.3% to 0.5% on NHG-backed mortgages compared to similar non-guaranteed loans. This reduction occurs because lenders face minimal loss risk when the government guarantees the mortgage through the NHG scheme.
The rate advantage varies among different lenders and market conditions, but consistently remains substantial across the Netherlands banking sector. Major banks like ABN AMRO, ING, and Rabobank all offer preferential NHG rates as a standard practice.
This government backing allows lenders to offer these mortgages at rates closer to what they charge for the safest borrowers, even if your personal financial profile might normally warrant higher rates. The result is that NHG makes quality mortgage rates accessible to a broader range of homebuyers in the Dutch residential market.
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If I sell my house or refinance, what happens to the NHG guarantee I already paid for
When you sell your house, the NHG guarantee automatically terminates when you pay off the mortgage, and you do not receive a refund of the fee you originally paid.
The NHG fee is a one-time payment for coverage during the specific mortgage term, not a transferable benefit that follows you to new properties. This means each new home purchase requires a fresh NHG application and fee payment if you want continued coverage.
Refinancing your existing mortgage presents a more complex situation where you may or may not retain NHG coverage. If you refinance with the same lender for the same property and the new mortgage terms still meet NHG requirements, you might maintain coverage without paying a new fee.
However, if you refinance with a different lender, increase the mortgage amount above NHG limits, or change the property usage, you will likely need to apply for new NHG coverage and pay the fee again. The specific outcome depends on your refinancing circumstances and the new loan structure.
For homeowners who move frequently or plan to refinance multiple times, this fee structure can become costly over time, making it important to factor these costs into your long-term housing and financial planning in the Netherlands property market.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
The NHG mortgage guarantee offers valuable protection and cost savings for qualifying homebuyers in the Netherlands, with interest rate reductions that often exceed the one-time fee cost within a few years.
However, the scheme's restrictions on property prices and usage, combined with the non-transferable nature of the guarantee, require careful consideration of your long-term housing plans before applying.