Short answer: a VvE loan is in the name of the owners' association (VvE), not of the individual owners. Repayments and interest are paid through your monthly VvE contribution, and when an apartment is sold, that obligation passes to the new owner. So if you buy an apartment in a building whose VvE has a loan, you take over part of that debt. According to the Dutch Tax Administration (Belastingdienst), that share also counts towards the transfer tax, which can even cost you your first-time buyer exemption.
How does a VvE loan work?
A VvE can borrow money for major maintenance or sustainability work, for example from the Nationaal Warmtefonds, a Dutch fund for energy-saving measures. The VvE is the borrower. Every owner pays their share of the repayments and interest as part of the monthly contribution to the VvE. You pay for as long as you own the apartment; when you sell, the buyer carries on paying.
For you as a buyer, that means three things.
1. Your monthly costs are higher than the apartment suggests
The repayments and interest are part of the VvE contribution. A low asking price can therefore come with a high monthly contribution that runs on for years. Look not only at today's contribution, but also at how long the loan runs and whether there are plans to borrow more.
2. You may be able to borrow less for your mortgage
Dutch mortgage lenders look at your total housing costs. A higher VvE contribution can therefore reduce how much you can borrow. Ask your mortgage adviser to calculate with the contribution including the repayments on the VvE loan.
3. Your share counts towards the transfer tax
This is the point that surprises many buyers. In the Netherlands you pay transfer tax (overdrachtsbelasting) when you buy a home, unless you qualify for the first-time buyer exemption (startersvrijstelling). According to the position of the Tax Administration, shared through the Royal Dutch Association of Civil-law Notaries (KNB), when you buy the apartment you also take over the obligation to repay your share of the loan. That share is therefore part of what you pay for the home.
An example described by the notary's office Van Grafhorst:
| Amount | |
|---|---|
| Purchase price | € 550,000 |
| Share of the VvE loan (€ 40,000 divided over 4 apartments) | € 10,000 |
| Basis for the transfer tax | € 560,000 |
| Transfer tax (2%) | € 11,200 |
Because the basis came out above the limit for the first-time buyer exemption, this buyer could not use the exemption. He had counted on paying zero transfer tax.
The tricky part: information about VvE loans often only comes to light shortly before the transfer at the notary (notaris), through the VvE's managing agent. By then your financing may already be arranged.
What we see in VvE dossiers
In 25% of the VvE dossiers we have fully analysed, a large loan was involved. Two examples:
- a VvE that took out a maintenance loan of € 2.4 million, partly for new lifts: a 20-year term, fixed interest, more than € 200,000 a year in interest and repayments;
- a VvE with a sustainability plan: according to the VvE, the average monthly contribution of € 120 would end up between € 177 and € 521 (2.45 times as high on average), plus a one-off contribution of between € 6,358 and € 20,374 (€ 11,132 on average). A 20-year loan was proposed.
In both cases this was in the minutes and the meeting agenda, not in the sales listing.
Checklist for buyers
- Ask before you make an offer whether the VvE has a loan or plans to take one out. Ask the seller and the VvE's managing agent.
- Ask for the amount, the term, the interest rate and your share of the loan.
- Read the minutes and the agenda for decisions about loans or sustainability.
- Ask your mortgage adviser to calculate with the VvE contribution including repayments.
- Ask the notary whether your share counts towards the transfer tax and what that does to the first-time buyer exemption.
Frequently asked questions
Do I have to pay off a VvE loan when I buy the apartment?
Not in one go, but you pay your share through the monthly VvE contribution for as long as you own the apartment.
Does a VvE loan count towards the transfer tax?
According to the position of the Tax Administration, shared through the Royal Dutch Association of Civil-law Notaries, it does: your share of the loan is part of what you pay. Ask the notary how this works out in your situation.
How do I find out whether the VvE has a loan?
Ask the seller and the VvE's managing agent, and read the minutes, the budget and the annual accounts. A loan shows up there as a debt, or as repayments in the budget.