Getting a mortgage with the 30% ruling: what it means for your borrowing power
Published on 2 min read
In short
How the 30% ruling affects your qualifying income, why lenders treat it differently, and what to consider for when the ruling ends.
The 30% ruling makes working in the Netherlands attractive, and it also increases your borrowing power: part of your salary is paid out tax-free, so your net disposable income is higher. But not every lender counts the ruling in the same way, and the ruling is temporary. That calls for a well-prepared application.
First calculate roughly what you can borrowWhat the ruling does for your income
With the 30% ruling, your employer pays out part of your salary tax-free, as compensation for the extra costs of working abroad. Your gross annual salary stays the same, but your net income is higher than that of a colleague without the ruling.
That matters for a mortgage, because lenders look at your income to determine what you can afford. How exactly they do this differs: one assesses your actual gross income including the effect of the ruling, another only looks at your base contractual salary.
Why the assessment differs per lender
Some lenders recognise that you keep more net income and therefore calculate with a higher qualifying income. Others do not, or only under conditions, for example based on the remaining duration of your ruling. The difference in borrowing power can be substantial.
That is why it makes sense not to knock on one bank's door, but to compare which lender assesses your situation most favourably. That is precisely the work of an independent adviser.
The ruling is temporary
The 30% ruling has a maximum duration and can end early, for example if you change employers and the transition is not arranged properly. When the ruling ends, your net income drops while your mortgage payments stay the same.
A sensible application takes that into account. That does not necessarily mean borrowing less, but it does mean knowing what your monthly payments look like when the ruling ends, and being able to carry that amount too.
Other points that matter for expats
Besides the ruling, lenders look at your employment contract, your residence status and sometimes your nationality. A permanent contract or an employer's statement strengthens your application. With a temporary contract or a short history of living in the Netherlands, fewer lenders will say yes, but options do exist.
Savings or income from abroad can also play a role, positively or as an extra question in the assessment. Document this in your file beforehand, so you do not run into surprises later.
How to prepare your application
Make sure you have the Tax Administration's decision granting the 30% ruling at hand, together with your employment contract and payslips. Have your borrowing power calculated in two scenarios: with and without the ruling. That way you know exactly where you stand, now and later.
With that preparation, a mortgage with the 30% ruling is not a complicated story, but a matter of choosing the right lender.