Student debts should be taken into account when home buyers apply for a mortgage to prevent them borrowing too much, homeowners’ lobby group VEH said on Monday.

At present student loans are not included in the national debt registry BKR which lists credit agreements with banks, mortgage providers and other official credit agencies.

‘If you earn €40,000 gross a year and you have a student debt of €30,000, the maximum you can borrow should be €138,000,’ spokesman Hans Andre de la Porte told broadcaster Nos. ‘But if you exclude the debt, you can borrow €180,000.’

Interest rates

Both the VEH and the BKR say student debts should be included in the register to prevent home owners taking on irresponsibly high loans and getting into financial trouble later. BKR research indicates 39% of former students do not tell their mortgage advisor about their student loan.

The education ministry has said in the past that there is no similarity between a student loan and a bank debt. Student loans carry modest interest rates and only need to be repaid when the person’s finances allow it, a spokesman pointed out.

Students currently leave university with a debt of around €15,000 but that is expected to rise to around €21,000 now grants have been scrapped. However, RTL research last month said over 15,000 former students have built up debts of at least €50,000. Some 600,000 graduates are currently repaying a student loan.