Why AI can’t get you a mortgage but a human can

Internationals are not only depending on artificial intelligence to help them at work; an increasing number are asking services like ChatGPT about buying a home. Mortgage brokers are hearing more from new clients who have first used AI to try to understand the Dutch property market.

It's natural that people want to know more and to be prepared, but there is danger in using AI as the only source of information. Artificial intelligence responds to prompts that the user inputs, and unless you already understand the Dutch mortgage market, you aren't likely to be asking it the right questions.

There are peculiarities to Dutch law and to how Dutch banks operate that tend to catch people out, even after they've used AI to do their research. Here is what you need to think about when considering a Dutch mortgage.

Credit rules are standardised

Most expats believe that each bank will offer you a different loan amount. This is common in many countries around the world, including the UK and the USA; people can go to four different banks, which would look at their credit score or equity as well as their income, and each bank will come up with its own offer. 

In the Netherlands, however, most of the rules are standardised. Theoretically, if you go with the same income to four different banks, and all have the same interest rate, all four should give you the same loan amount.

Finding the best deal

That doesn't mean that there aren't different options out there. While each bank will likely loan you the same amount of money, the terms of that loan can vary, not only from bank to bank, but also between various offers from the same bank. Partnering with an experienced mortgage advisor might cost you a little up-front, but they can save you a fortune over the life of your mortgage.

Online searches might tell you about different banking rates, but they won’t ask detailed questions like a mortgage advisor will. It is critical to think about your future plans if you are taking on a long-term financial commitment: are you planning to start a business? What if you find a partner, or split up with a partner? Is there a possibility that you will want to move abroad and rent out the property? It is a mistake to assume that these kinds of life changes will not affect your mortgage.

Contact Expat Mortgages to secure the best deal on your mortgage

The devil is in the detail

ChatGPT can tell you about the broad brush strokes of the Dutch mortgage market, but it can never give reliable advice for your specific circumstances. Even if you knew every useful piece of information to feed it, it doesn't know the market like a broker does.

For example, if you want to be able to pay off more than 10% of your loan per year without a penalty, none of the big banks allow for that. Yet, if your monthly mortgage costs are not too high, the chances are that you’ll have some money spare that you might want to use to lower the mortgage. A mortgage broker will know which of the smaller mortgage providers allow for this, and would also think to tell you about this limitation in the first place.

Then there's what do you do if your income varies and you have different levels of bonus each year? While normally only an average of your personal bonus over three years counts, if you are in a clearly growing industry, some providers might be prepared to consider company performance-related bonuses too. A mortgage advisor can help you find the provider that will offer you the best deal.

International complexities and taxes

An advisor can also give you additional information. There are signs, for example, that with uncertainties around American policy, some banks are being more cautious about personal income related to dollars.

Dutch politicians are currently discussing winding down a tax perk for mortgages (the hypotheekrenteaftrek), as in other countries, because a critical deadline is coming up in 2031, and the perk is becoming ever more expensive. These are important issues to discuss with a mortgage advisor to ensure you are taking on a responsible level of debt.

The personal touch

Finally, ChatGPT might be able to tell you about policy, but it doesn’t have those vital personal connections. The personal touch doesn't only count between you and your advisor, it also counts between your advisor and the mortgage providers and facilitators.

Buying agents, selling agents, insurance companies, valuers; these are all human connections that an AI is not going to be able to provide. A good advisor can even speed up the process for you, thanks to their reputation and network.