New and remodeling Belgium

New and remodeling

It is possible as a non-resident of Belgium to get a mortgage for new construction or a purchase + renovations. However, banks impose conditions on this. One wants to finance construction projects carried out by official Belgian contractors. Depending on the bank, (partial) self-build can also be financed with a mortgage.

The maximum financing rate for new construction is applied to the sum of the land purchase and total construction cost. For remodels, the maximum financing rate is applied to the sum of all remodels for which quotes are available from contractors.

The process of getting financing done for new construction or purchase + renovations is more intense than the process of a purchase (existing construction). Hypotheek & Buitenland also accompanies these routes, but at a higher rate for the service compared to financing existing construction.

An appraisal (valuation) will determine the value of the property before and after renovations. If the value of the house before and/or after completion is less than the sum of purchase + renovations then the bank may adjust the maximum loan amount accordingly.

A fully documented building permit application should be made to local authorities. The purchase of building land often includes a condition precedent in case the building permit is unexpectedly not granted.

Some Belgian banks also finance (partial) self-construction (conversions that one wants to do oneself).

Release of the mortgage funds (construction installments) is made from construction deposits on demand from the client as the works progress and invoices come in. The condition is that a mortgage guarantee is placed on the land by mortgage deed. With some banks, the mortgage remains repayable until the construction deposit is withdrawn in its entirety (usually with a maximum term of max 2 years). Interest is then paid on the released funds and a commitment fee on the mortgage funds not yet released.