Newly Built renteverlies tijdens de bouw

(*) 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 invoices expired of the contractor / project developer) will be paid and the remainder will be transferred to your deposit. From this deposit the consecutive invoices of the project developer or contractor will be paid, per phase of completion. You will receive interest over the amount in your 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 integrated in your mortgage loan, interest paid on this part of the loan (dedicated to renteverlies tijdens de bouw) provided it is integrated in the mortgage loan is not subject to tax relief.

(*) Project developers interest (Bouwrente I) phase before the purchase contract is signed

If you buy your newly built home or apartment 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 in 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 I used by the project developer) is always higher (6-8%) than the interest charged by the bank. 

(*) 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 wll be paid as soon as the mortgage loan has been registered and the bank has opened a deposit. Intrest paid for a loan for Bouwrente II is not subject to tax relief.