An important change with regard to the tax-deductibility of residual debt financing with effect from 1-1-2018.
You can continue to finance your residual debt with the low-interest rates of a personal loan or revolving credit, but the interest costs are no longer tax- deductible, as was the case until December 31, 2017. This is a government decision.
We have written about it before: the residual debt financing. We have mentioned on several occasions that the interest costs for the residual debt up to and including 31 December 2017 are deductible. Then no more; the interest deduction for the residual debt on your home is canceled.
Will you still be able to complete your home sale before the 31st? In that case, you may still deduct the interest costs for tax purposes for 15 years. Will your home be sold after 1 January 2018 and is the selling price lower than the mortgage amount taken out? Then you have to finance the remaining debt in a different way and the interest is no longer deductible.
No permanent arrangement for the homeowner
The temporary measure, 15 years deduction of the interest on a residual debt on the house, is coming to an end. For a long time, people had hoped that the new cabinet would extend the temporary measure or even convert it into a permanent homeowner scheme. Nothing is less true. The planned end date of December 31, 2017, will also be the final end date.
Consumer credit as financing
All homes that are still being sold this month and that have a residual debt are eligible for the tax deduction. This benefit will expire with effect from 1 January 2018. At the same time as the interest deduction disappeared, the maximum mortgage fell from 101% to 100%, so there is no room for residual debt financing.
The mortgage that you take out for the new home is purely for the purchase of the home. Additional renovations or co-financing the remaining debt is not possible. You need to find another form of financing for these costs.
Calculate online loan amount
With now a “for sale” sign in the garden, chances are very small that the house will be sold this year. That gives you time to anticipate the financing of any residual debt. And renovations to the new home or the costs to be paid by the buyer.
How are you going to finance it? Do you have enough savings or do you need a (supplementary) loan? You can make a calculation through our loan guide and see what you can borrow. Then you have an indication and you can make an overview of the expected costs for yourself.
Combination credit for high loan amounts
In some cases, borrowing high amounts is a solution. A major renovation costs a lot of money. When taking out a combination loan, two personal loans are placed in spread with two banks. Thanks to this risk spread for the bank, you borrow at a lower interest rate and an amount of up to $ 150,000 is possible.
You can borrow from 10 years at a low-interest rate from 4.1%. Do you lend to your home for a renovation? Then the interest costs are tax-deductible. This combination credit has better conditions and more options than a “normal” personal loan or revolving credit.
Transfer current financing
Did you sell your house with a residual debt last year and do you have an expensive residual debt financing? You can transfer it to us free of charge. This is easily done online via our transfer service. You enter all data and we arrange the rest so that you, like our other customers, will benefit from low-interest rates and favorable conditions.