Living and working in Brussels: Buying a home

If you've got a job, and a clear track for your employment, you may want to make long term commitments and 'spend ahead', depending on your plans. In that case buying a house would be an understandable move.

Buying a home is a major long term commitment. It's advisable to check out the market, and do some reality checks on payments in terms of your budget.

This is another case where being unfamiliar with the market can be a real problem for expatriates:

• Shop around for mortgage rates.
• Take professional advice regarding legal and financial issues, and consider available options.
• Use local knowledge. You'll find your Belgian friends will be able to advise and will have opinions about possible homes.

The process of buying a home

The first step in buying a home is signing an Agreement to purchase. This agreement is evidence of your commitment to buy the premises. This agreement must be witnessed by notaries for both parties and has a maximum period of 4 months.

The price of the property is calculated as

• The principle, or seller's price, plus
• Registration fees of 6% to 12.5% as the state tax component, plus
• Legal services fee for the notary of about 1.6%

These fees mean that your actual payment is up to 17% above the basic price.

A schedule of fees also applies to a mortgage loan.

Notaries

Notaries work on standard fees.

Mortgages:

Standard commercial mortgages are available in Belgium, but one form of mortgage, the 'bullet' mortgage, may not be familiar to foreigners. This form of mortgage involves payment of interest only during the term of the loan, with the capital payable at the end of the term.

Mortgages and related Insurance

There are some possible complexities, but also some possible benefits, in insurance-related mortgages.

There are some Belgian forms of insurance which aren't available in some countries, and nor are the insurance-related mortgages, so you'll need to study any offers you receive regarding them.

You could find yourself trying to understand a form of mortgage you haven't seen before, with a form of insurance you haven't seen before. Get advice, and make sure you know what your costs are going to be. Again, ask your Belgian friends for their opinions.

It is possible to insure your mortgage with life insurance policies for payment on death, and to also take out standard household insurance with mortgage lenders.

The difficulty is that these policies can be costly. Some lenders offer discounts on mortgages based on taking out insurance with them as well.

You need to know how much the costs are going to be, and to make comparisons with other lenders before making a decision.