Mortgage providers do not sufficiently reflect the importance of customers when it comes to clarity about risk storage. This is the opinion of the Netherlands Authority for the Financial Markets (AFM), which conducts customer interest surveys every year.
Risk storage is an extra interest that you pay on top of your mortgage interest. If, for whatever reason, you form an extra risk in the eyes of the mortgage lender, you calculate these extra costs.
Adjust risk storage
When you (interim, contractual or early) redeems, the possible risk for the mortgage provider changes. The AFM survey shows that by no means all mortgage providers adjust the storage of their own when the risk changes for them. A limited number of mortgage providers adjust the storage automatically in such situations. Other providers offer customers a possibility to submit a request to adjust the storage. This option is considered by the AFM against equal treatment of customers; proactive customers receive preferential treatment.
As a result of AFM’s investigation, mortgage providers have agreed to change their policy. The survey showed that some providers maintained unequal standards. Existing customers were offered a rate that did not match the current risk profile at the time of interest rate review. New customers received a suitable interest rate.
AFM wants suppliers to actively inform their customers about changing risk storage. Ongoing, but at least at the time of an interest rate review. For example, by letting each year know how much a customer can pay off. Increasing the value of the home is also a reason to actively approach customers.
Another saving on your mortgage payments applies to interest rate averaging. This may not be more expensive than necessary. Because mortgage interest is currently (still) very low, many people close the mortgage. This can result in a high fine, because the bank may claim the lost interest income in one go. That can amount to more than ten thousand euros. If you can not or do not want to pay that fine, but do want to profit from the lower interest rates, interest rate averaging is an option. The average of the current interest rate and the originally agreed interest is calculated. A small storage comes with this. The sum determines the new interest. Because no maximum was given to this surcharge, Minister of Finance has now decided that the storage should not be higher than the bank’s disadvantage.