Bank pays for new mortgage deed in case of change of leasehold

If a leaseholder switches from a perpetual to a perpetual lease, the bank may request a new mortgage deed. However, the costs of drawing up this new deed are borne by the bank. This is evident again from a ruling by the complaints institute Kifid, this time on appeal.

The decision of the Kifid Appeals Committee is binding and follows a decision by the Disputes Committee of the complaints institute, which made a similar ruling in March last year.

Minimal risk for the bank
In this case, a homeowner took advantage of the Amsterdam municipality's option to switch from perpetual to perpetual leasehold. According to the bank, this entailed the risk that the bank's existing mortgage would not encompass the amended leasehold. However, Kifid ruled that the switch to perpetual leasehold was not so substantial as to create a new leasehold.
The amendment to the leasehold therefore poses a minimal risk to the bank that its mortgage rights will be jeopardized. This makes drafting a new mortgage deed unnecessary, according to the Appeals Committee. If the bank does require a new mortgage deed from the leaseholder, it must pay the costs itself.

Similar complaints
Kifid is still handling several similar complaints regarding the costs of a mortgage deed when switching to perpetual leasehold. The complaints institute will assess these in accordance with this new ruling.