Self-employed residents of the Netherlands who are looking to buy a home are significantly disadvantaged by the bureaucratic process, shows a report based on survey data from the Dutch Homeowners’ Association (VEH) and self-employment research institute KIZO.

Though the number of freelancers, also known as ZZP'ers, is growing rapidly amongst the population of the Netherlands, many still encounter a wall of "distrust" when approaching the bank for a mortgage.

Few self-employed obtain mortgages

The study was based on survey data from 851 self-employed people living in the Netherlands, 651 of whom owned a home and 200 of whom lived in rental housing.

The researchers found that for every 10 ZZP'ers with a mortgage, four obtained it before having become self-employed, while still working under an employment contract. Another four out of 10 only managed to close the mortgage by basing everything on their partner’s income.

Roadblocks for the self-employed

In many cases, the challenge for self-employed people seeking mortgages is not to fulfil the basic bureaucratic obligations - they can frequently provide all the necessary documents.

But they struggle to cope with the extra hurdles that loan officers, who view self-employed clients as high risks, erect when dealing specifically with them.

The additional costs and requirements self-employed applicants often face include the following:
› Higher consultancy costs
› Higher premiums
› Higher down payments
› Mandatory guarantees 
› Ineligibility for the National Mortgage Guarantee

Banks face changing labour market

With more people choosing self-employment in the Netherlands than ever before, major banks are already taking steps to remove some traditional requirements.

Some are now willing to scrap the old rule requiring three years’ worth of financial statements, as long as the client brings in an industry expert who can give a favourable prognosis.

According to Michel Ligtlee of the Dutch Homeowners’ Association, banks in the Netherlands need to do more. They face enormous challenges adapting to these recent shifts in the labour market, but should be focusing on step-by-step change.