What is the cost of withdrawing 50,000 euros of excess value?
You're thinking about withdrawing €50,000 in excess value from your home. Maybe for a remodel, preservation or paying off existing debt. But what does that really cost?
When withdrawing surplus value, you pay back an amount each month. There are also one-off costs you must take into account. Below is a clear overview of the monthly costs and additional expenses.
Cost summary 50,000 euro excess value withdrawal
So in total, you pay back almost €96,500 for a withdrawn amount of €50,000 in excess value. That seems a lot, but because of the long term, your monthly expenses are relatively low. You pay off quietly, without great pressure on your budget.
Most people choose an annuity loan. You can also choose an installment-free mortgage. Then you only pay interest and your monthly expenses remain lower, but you don't repay anything. This is only possible if your income and financial situation allow it.
One-time costs are also important. Consider advice, appraisal fees and notary fees. Many of these costs are deductible on your tax return.
Want to know what's wise in your situation? An independent mortgage consultant will help you further. For free and without fuss.
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Monthly expenses when withdrawing 50,000 euros of surplus value
If you withdraw €50,000 in excess value, you'll want to know what you'll pay each month. Because whether you want to remodel, preserve or add to your savings, your monthly expenses will determine whether it suits your situation.
Suppose you take out a new €50,000 mortgage. With a mortgage interest rate of 5% and a term of 30 years, you pay:
- Gross monthly cost: €269
- Net monthly cost: €185
- Total repayment: €96,500
You pay interest and principal. So your mortgage debt decreases each month, and you build up equity at the same time. The net monthly cost depends on your income and whether you can deduct the mortgage interest.
What if your interest rate is different?
The amount of your interest rate makes a lot of difference. Compare:
- 4% interest: €238 gross per month
- 6% interest: €302 gross per month
Do you choose a short fixed-interest period? Then your interest rate is often lower. But you run more risk of higher monthly costs if interest rates rise.
Can it also be grace-free?
Yes, you can also take out an installment-free mortgage. Then you only pay interest. At 5%, that works out to €208 a month. Your monthly burden is lower, but your loan remains fully outstanding. This is only allowed if your income and home value allow it.
What else does your monthly burden depend on?
The cost depends on several factors:
- Your current mortgage and whether you can increase it
- The value of your own home
- Your choice of a second loan or increasing your existing mortgage
- Whether you choose repayment or interest only
- Your income, expenses and how much excess value you want to withdraw
Do you choose to redeem? Then you build up capital, but you'll have extra monthly expenses. With no-repayment, your debt remains. In both cases, your monthly costs increase.
Want to know if you should withdraw home equity? Then schedule a free consultation with an independent mortgage advisor.
One-time cost 50,000 euro excess value withdrawal
If you withdraw 50,000 euros of excess value, you will face one-time fees. You only pay these when you take out a new mortgage or if you increase your existing mortgage. After that, you don't have to worry about it anymore.
You pay for advice, notary fees, having your home appraised and sometimes closing costs. Below are the most common items:
- Mortgage advice - €2000 to €3500. A mortgage advisor looks at your income, home value and whether it is smart to apply for a second mortgage or increase.
- Appraisal fees - ± €850. Your home must be reappraised. In this way you demonstrate that you have sufficient surplus value and your mortgage lender can assess whether the surplus value taken up is justified.
- Notary fees - €400 to €800. The notary draws up a new mortgage deed. This is necessary in case of a higher mortgage or new mortgage part.
- Closing costs - ± €250. Some lenders charge closing costs when withdrawing surplus value or taking out an additional mortgage.
The one-time cost of withdrawing €50,000 in excess value is between €3250 and €5150. That includes advice, notary, valuation and closing costs.
Good to know: many of these costs are deductible on your tax return. Consider advisory and notary fees when taking out a new mortgage.
Is withdrawing surplus value wise?
Withdrawing €50,000 from your surplus value is no small step, but it also offers opportunities. You can use it to make major renovations, make your home more sustainable or even finance part of a second home or new house. The monthly burden remains relatively low, but it is and remains a loan.
Whether it is wise to withdraw the surplus value depends on your goal, your financial space and how your home has developed. The table below shows when withdrawing €50,000 is often a smart choice and when it is not:
Still doubting whether withdrawing €50,000 in surplus value is a smart choice? Find out in this article when it's wise to use your surplus value and when it's not.
Cost excess value inclusion in other amounts
Don't want to withdraw 50,000 euros of excess value on your home, but a different amount? Then it is useful to know what monthly charges and one-time costs are involved. Check out the costs of withdrawing surplus value in other amounts here:
- What is the cost of withdrawing €10,000 in excess value?
- What is the cost of withdrawing €30,000 in excess value?
- What is the cost of withdrawing €100,000 in excess value?
Are you unsure how many euros of excess value is best to withdraw through your mortgage? Then request a free consultation with an independent mortgage advisor. You'll get instant insight into your costs, options and monthly expenses.
Here's how to calculate home equity
You can only withdraw €50,000 if you have sufficient excess value. That excess value occurs when your home is worth more than your outstanding mortgage.
You calculate it simply: the current value of your home minus your mortgage debt.
Your home is worth €400,000. You still have €350,000 of mortgage outstanding.
400,000 - 350,000 = €50,000 excess value
You can withdraw this €50,000 by increasing your mortgage or taking out a second mortgage.
Want to know if this is possible in your situation? Read how to calculate your excess value or schedule a free consultation with a mortgage advisor.
Frequently asked questions 50,000 euro excess value withdrawal
When withdrawing surplus value, you face additional costs and choices. But what exactly do you pay per month, and what do you need to consider? In the frequently asked questions below, we provide clear answers so you know exactly where you stand.
What does 50,000 euros extra mortgage cost per month?
At 5% interest and a 30-year term, you pay about €269 gross per month. Net that works out to about €185, depending on your income and mortgage interest deduction. You pay interest and repayment. So your mortgage debt decreases and you build up equity.
What does 50,000 euros of surplus value take out redemption-free?
With a €50,000 grace-free mortgage, you pay only interest. At 5% interest, that's about €208 a month. Your monthly expenses remain lower, but your debt remains in full. This is only possible if you have sufficient income and does not suit every situation.
Should I take out a second mortgage for 50,000 euros of excess value?
Sometimes you can. You can increase your existing mortgage, but some providers require a second mortgage. It depends on your home value, your current mortgage and your financial situation. A mortgage or financial advisor will look at what best suits your situation.
How does withdrawing surplus value work?
With surplus value withdrawals, you borrow money based on the value of your home, minus your mortgage debt. You can do this by increasing your existing mortgage or taking out a second mortgage. You then receive an amount that you are free to use, for example for a renovation, new home or extra savings. You then pay monthly costs in the form of interest and (usually) repayment. Whether that fits depends on your income and home value.
What can you do with your home's surplus value?
You can use your surplus value for many different things. Consider remodeling, buying a new car, making your current home more sustainable with energy-saving measures, or as an addition to your equity. Some people use the entire surplus value to buy a new home. What is smart depends on your situation. Get good advice about what you can do with your surplus value.
Is withdrawing surplus value expensive?
You will face additional monthly charges and one-time costs such as advice, appraisal fees and notary fees. With a longer term, your monthly burden remains low, but you pay more interest. Withdrawing surplus value is often cheaper than borrowing via a personal loan.
What happens to your mortgage debt if you withdraw surplus value?
Your remaining mortgage debt increases because you add a new mortgage part or increase your existing mortgage. So your total mortgage amount increases. You pay monthly interest (and sometimes repayment) on the surplus value taken.
What if your home becomes worth less after withdrawing surplus value?
Then you have a higher loan amount than your home is still worth. That can put you in a higher risk category with your lender. You may then pay a higher mortgage interest rate than when your home was valued higher. Do you have doubts about your home value or falling house prices? Then get proper advice.
Are the costs of withdrawing surplus value deductible?
Most one-time expenses, such as consulting and notary fees, are deductible on your tax return. You can also deduct mortgage interest in many cases, as long as you actually repay the loan. Do you opt for an interest-only mortgage? Then the interest is usually not deductible. How much you get back depends on your income and tax situation. So you can offset part of your monthly costs again.
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