How To Get a Loan in The Netherlands As A Foreigner

There are many situations in life when you might consider getting a loan. Borrowing money from the bank isn’t always the best solution, but it’s the preference of many Dutch when they don’t have other alternatives. In the end, getting a loan has become a common process for many banks, and many residents sooner or later use private lending.

To receive a loan in the Netherlands as a foreign national, you must have your primary residence in the Netherlands and a stable income that can be proven with the employment contract.

Living in the Netherlands is expensive, and you might not have enough savings for large purchases. Then loans from banks and other institutions come in handy. Luckily, today you can choose among plenty of lending options even if you are a foreigner.

Can a foreigner get a loan in the Netherlands?

Foreigners living in the Netherlands can get a loan if they have a Dutch residence permit and a stable source of income. They must fully repay the loan before leaving the country.

Generally, every resident between the ages of 18 and 65 with a regular income is eligible for a loan in the Netherlands.

Before making a decision on financing, all banks register the application with the BKR (Central Credit Registration Agency) to prove your creditworthiness.

It keeps all information about debtors, creditors, and credits in the country. Hence, it will show your credit score and if you have other debts. Lenders will also assess your income and expenses.

Furthermore, getting a loan as a foreigner is more difficult if you were a Dutch citizen. That said, citizens of EU/EEA countries have better chances of getting a personal loan or mortgage in the Netherlands than non-EU/EEA nationals.

For example, your residence status greatly impacts how much you can borrow and for how long. The loan approval and conditions will also depend on your employment and income.

If you aren’t from the EU/EEA, a permanent residence permit might be required in some cases. 

Moreover, having a good credit history in the Netherlands will help even someone from non-EU/EEA to get financing.

On the other hand, to obtain a mortgage, you will usually need a permanent residency in the country or a stable job with a good salary.

That said, some basic requirements for getting a loan in the Netherlands include:

  • Residency in the Netherlands
  • Regular income, e.g., a job in the Netherlands

Types of loans in the Netherlands

There are various types of loans in the Netherlands. Some of the most common are personal loans and car loans.

1. Personal loans in the Netherlands

Personal loans are the most common way of lending. These are universal loans and can be used for a range of different purposes. In most cases, you don’t need to justify why you are lending money.

Personal loans in the Netherlands have the following characteristics:

  • The loan amount is paid out at once and in full
  • You pay a fixed amount every month. The payment includes the interest rate and your repayment.
  • The term duration is fixed and has a minimum period of 12 and a maximum of 180 months. 
  • The interest is fixed and doesn’t change during the term
  • Depending on the provider, early repayment can be with or without a penalty.
  • You can’t increase the loan amount in the meantime. If you need more money, you can take out a new loan.

Hence, there are some advantages and disadvantages of personal loans.

To be able to take a loan, you need to make sure that you will be able to pay it back. Only take a loan as a last chance to get a financial solution to the problem.

Some popular Dutch banks where you can apply for a loan include ING, ABN AMRO, Rabobank, Santander, and BNP-Paribas.

Here is an example of personal loans from Santander bank:

Credit amountMonthly installment Interest ratePercentage for a loanTerm duration Total payment
  €1,500  €2710.0%10.0%72 months  €1,977
  €2,500  €46 9.9% 9.9%72 months  €3,296
  €5,000  €65 9.9% 9.9%120 months  €7,787
 €12,500 €155 8.9% 8.9%120 months €18,643
 €25,000 €311 8.9% 8.9%120 months €37,286
 €37,500 €466 8.9% 8.9%120 months €55,929
 €50,000 €621 8.9% 8.9%120 months €74,572
Source: www.santander.nl

2. Car loan

Car financing is very common in the Netherlands. Usually, you can sign for a loan with the dealer where you are purchasing a vehicle. That can be both new and used cars.

Generally, car loans also belong to personal loans. Most Dutch banks provide car financing also for foreigners. It includes major institutions like ING, ABN-AMRO, Santander, etc.

Lenders often will require three years of employment history in the Netherlands and a good credit score. The term for car loans is similar to personal loans – from 12 to 180 months.

3. Mortgage

A mortgage is pretty self-explanatory financing. If you want to buy or build your own house in The Netherlands, you most likely will need to get a loan.

Getting a mortgage as a foreigner in the Netherlands

The ease of getting a mortgage in the Netherlands will depend on whether you are from an EU/EEA country or not. Conditions and the process for EU citizens is very similar to Dutch.

The process is more complex for EU/EEA citizens because lenders want security. If you were leaving the Netherlands for your home country, it’s almost impossible for a bank to find you.

That said, an applicant often should have a permanent residence permit when applying for a house loan. You also must have a job and present your working contract.

Best loan providers in the Netherlands

Some of the best lenders in the Netherlands are:

ProviderInterest rate (min)Max. loan amount
ABN-AMRO5.5%75,000 EUR
Santander8.9%50,000 EUR
ING6.50%75,000 EUR
Rabobank7.55%75,000 EUR
Lender & Spender6%50,000 EUR
Becam4.7%75,000 EUR

Interest rates

The interest rate depends on the loan provider, the borrowed amount, and on the duration of the term. The higher the sum you want to borrow, the lower the total interest. Generally, interest rates for personal loans in the Netherlands range between 5% and 12%. 

Here are current interest loans at various loan providers in the Netherlands (based on the term of 60 months):

Loan amountInterest rateLenderMonthly installment
€2,5009.9%Santander€53
€5,0008.3%Lender & Spender€102
€10,0006.3%Directa€194
€25,0004.9%Freo€470
€50,0004.8%Freo€937
€75,0004.8%Freo€1,405
Source: www.geld.nl

Loan requirements for foreigners in the Netherlands

To get a loan in the Netherlands, you must meet several requirements that include:

  • Reside in the Netherlands
  • Have permanent employment or temporary employment contract
  • Be of the age of 18 and older
  • The loan you are planning to take must be repaid before you reach the age of 81
  • Have a bank account at the Dutch bank
  • Lenders always request information from Credit Registration Office (BKR). It will show your credit score and existing debts
  • Lenders also will assess your current expenses

Besides, the bank will take into account the following factors when making a decision:

  • Your income
  • The sustainability of the income
  • Other obligations you have, including housing costs or other debts

Furthermore, the longer you have been living in the Netherlands, and the longer your residence permit, the better chances you have when applying for a loan. Foreigners with permanent residency get the highest approval rates.

To increase the chances of getting a car loan, apply for a term that isn’t longer than the duration of your residence permit.

Tips for getting a loan in the Netherlands

To ensure you have the highest chance of getting a loan with good terms, check the following:

1. Your credit score

The Dutch Credit Registration Office (BKR) collects all data about your current debts. If you have any other loan, it will be registered with the BKR. All banks will check whether you are registered with the BKR. Therefore, before applying for a new loan, make sure you don’t have outstanding obligations.

2. Choose the right lender

Today there are plenty of places where you can borrow money. They range from traditional banks with a long history, like ABN-AMRO, brokers, to online lenders like Becam.nl.

Online lenders offer better interest rates because they have fewer expenses to cover their operations, but they are also less secure.

3. Adjust loan amount and term

Your interest rate highly depends on the loan amount and term length. The more you borrow, the lower the rate. Yet, you also need to be realistic regarding how much you can borrow and when you can pay it back.

4. Compare different loan offers

Before you sign any contract, use online loan calculators that compare various loans across various providers. That way, you can ensure you are getting the best deal.

Anna

Anna is an enthusiastic expatriate with experience of living in Germany, Austria and Greece. She shares her passion for living abroad on this website.

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