(*) Loss of interest during construction period (Renteverlies tijdens de bouw)
With the registration of the mortgage loan contract at the notary office, costs (of land a/o contractor’s invoices expired) will be paid direct from your deposit. The remaining loan amount will be held in deposit and be paid -part by part – based on consecutive invoices of the contractor. The contractor sends you an invoice each time he has completed (part of) the work.
You will receive an interest reimbursement over the positive amount in your loan deposit. Simultaneously you pay interest for your mortgage loan. In time (and due to payment of the installments of the contractor) you will receive less interest. The (negative) total sum of this is called “renteverlies tijdens de bouw”.
If desired this sum can sometimes be (partially) integrated in your mortgage loan, if not it has to be funded (partially) from private assets,
(*) Project developers interest (Bouwrente I) phase before the purchase contract is signed
If you buy your newly built home or apartment (sign purchase agreement) whilst the construction has already been started for some time, the project developer has already made costs and did not charge these costs to you yet. Hence he will charge these costs + interest over the purchase of land and / or the invoices already expired – this is called bouwrente I.
Bouwrente I is integrated part of the purchase price (if it refers to the periode before signing the purchase contract).
Interest paid for a loan part dedicated for Bouwrente I is subject to tax relief. The percentage of bouwrente used by the project developer) is always higher (example 6-10%) than the interest rates charged of your mortgage loan.
(*) Project developers interest (Bouwrente II ) phase after purchase contract is signed and before notary office visit
Bouwrente II refers to the period after signing the purchase contract but before you visited the notary office. The Project developer charges interest for the costs he paid (advanced).
These cost will be paid as soon as the mortgage loan has been registered at the notary office and the bank has opened a deposit.
Intrest paid for a loan for Bouwrente II is not subject to tax relief.