Traditionally, the three largest banks in the Netherlands have a large market share. In recent years, their market share has decreased strongly to 50-55% of the yearly mortgage production. The other 45-50% is provided by a variety of different mortgage providers, including insurance companies, pension funds, small banks and foreign investors that have generated a large market share in a relatively short period.
From an international perspective, the Dutch mortgage portfolio has unique characteristics. Compared to most European countries, Dutch mortgages have high loan-to-value (around 81% at origination). Loan-to-income ratios are around 3.8. LTI limits are determined by the National Institute for Family Finance (NIBUD), thereby protecting households from excessive lending.
Meanwhile, default rates and the number of foreclosures are at an international low. In addition, there is a government-backed guarantee fund for mortgages up to €245,000 - a certain amount that protects banks against default and minimises risks. Mortgage providers are aided in risk assessment by the Bureau of Credit Registration (BKR). The BKR registers loans, arrears and defaults and can be accessed by mortgage providers.
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