An annuity loan is a loan in which the repayment amount is chosen for each term, the total payment (the sum of interest and repayment) per term is the same, and such that at the end of the term the entire loan has been repaid.
Such a redemption type is called annuity (in Flanders with a term of one month of humanity).
The redemption component is low at first, but increases exponentially (i.e., in a geometric row). The interest rate component is first high, but decreasing faster.
As of January 1, 2013, the Dutch Tax Revenue Act determines tax treatment for homeowners for new debts related to their own property that the interest paid is deductible only if it is a loan that is fully and at least annually repaid during the term. The total net housing load increases slowly during the period. Due to money discovery and career development, the burden is likely to remain well.
The interest-rate period may vary from one period to the entire term. In the event of a change in interest rates, the remaining maturity is not changed, but the forward amount for the remaining terms is recalculated. If this happens every time, there are therefore no remaining deadlines.
At rising interest rates, the monthly burden also rises. It is therefore not wise to conclude an annuity loan with a sum that can only be paid unless it is chosen to keep the interest-rate period equal to the term of the loan.
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