If you took out a “top mortgage” in the past (where the loan amount was higher than the property value), the bank charged an additional percentage on top of the normal interest rate – the “top surcharge.” This is linked to the risk category: the ratio between your outstanding mortgage debt and the value of your property. At 100% market value, which is now the maximum allowed, the mortgage debt and the property value are equal. Based on this ratio, the bank determines the interest rate you pay when your mortgage starts.

If your property value increases or you make (monthly) repayments on your mortgage, your loan may at some point fall into a lower risk category. The top surcharge can then be reduced or removed. However, not all lenders adjust this automatically. This means you may be paying too much interest unnecessarily, while your monthly payments could easily be lowered — but you need to take action yourself. We can, of course, assist you with this.

To make the calculation, you need to know your current outstanding mortgage balance and estimate your home’s current value. You can request a property valuation report here.

Questions? Feel free to contact us