The High Hurdle of the 'Waarborgsom'
The security deposit (waarborgsom) is one of the biggest financial hurdles for new tenants. In the free sector, landlords typically demand a deposit equivalent to two, or sometimes even three, months' basic rent. For an apartment costing €1,800 per month, this can mean an upfront cash outlay of €3,600 to €5,400, in addition to the first month's rent. While specific financial products like a 'deposit free loan' are not standard offerings from Dutch banks, there are a few avenues a tenant with insufficient savings can explore, though each comes with significant caveats.
Option 1: Municipal Special Assistance (Bijzondere Bijstand)
This is the most important official channel for those with low incomes and no personal capital. A tenant who cannot afford the security deposit and/or the first month's rent can apply for bijzondere bijstand (special assistance) from their local municipality (gemeente). This is a form of social assistance intended for necessary, but unaffordable, one-off costs. The process involves:
- A Strict Means Test: The municipality will conduct a thorough assessment of the applicant's income, savings, and debts.
- Demonstrable Need: The applicant must prove that securing this specific housing is essential and that they have no other means to pay the deposit.
If the application is approved, the assistance may be provided as an outright grant or, more commonly, as an interest-free loan that must be paid back over time. This is a last-resort safety net, not a standard financing option.
Option 2: Private Personal Loans
A tenant could technically apply for a small personal loan (persoonlijke lening) from a commercial bank to cover the deposit. However, this is a highly risky strategy. The tenant will be paying interest on this loan, adding to their monthly expenses. The most significant risk occurs at the end of the tenancy. If the landlord makes deductions from the deposit—fairly or unfairly—the tenant will not get the full amount back to repay the loan. They will be left paying off a debt for money they never got back, turning a temporary cash flow problem into a long-term debt.
Option 3: Deposit Guarantees
As an alternative to a cash payment, some companies offer a depositogarantie (deposit guarantee). The tenant pays a smaller, non-refundable fee to the guarantee company, which then provides a guarantee to the landlord. While this solves the immediate cash problem, the fee is a sunk cost. Unlike a cash deposit, you never get it back, making it a more expensive option in the long run if you are a good tenant who would have received a full refund.
