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FAQ

Frequently Asked Questions

Based on my income how much can I borrow from the bank?

Banks will assess each case individually, and based on the income(s) of the borrower(s), would be able to advise an amount that can be obtained for buying or constructing a home.

What is a ‘taxatie’ report?

The taxatie report is also knomwn as an appraisal report. You can get a post- or pre-construction report.

What types of insurance are associated with purchasing a home?

When purchasing a home you may want to look into the following Insurances:

  • Life Insurance
  • Personal Liability Insurance: Fire Insurance, Construction All Risk Insurance

As a non-resident can I apply for a loan?

Yes, most local banks will grant loans to non-residents. You can refer to a list of Banks in Aruba.

Based on the amount I borrow what size of home can I build?

The bank will give a guideline on the amount that can be spent per M2 which includes materials, equipment and labor.

Do I need to make a deposit when purchasing or building a home?

As a resident, depending on the cost of the home and length of time given to pay back the mortgage a deposit may be requested. As a non resident a deposit is requested.

What additional costs can one expect when purchasing a home?

When purchasing a home, one can expect:

  • Monthly Premiums for the different Insurances taken out.
  • Notary charges
  • Closing fees
  • Real Estate Agent’s Commission
What are the requirements for non-residents applying for a mortgage?

For non residents wanting to buying or build a home, most financial institutions require a deposit. The deposit amount varies depending on the bank or financial institution, and the borrowing amount normally cannot exceed the execution value of the house.

What is the cost per sq. meter (and sq. foot) for building a home?

Currently the going rate is Awg 1800 (US$1000) per M2. This can vary greatly depending on quality of building materials and from one contractor to another.

Do I need to make a deposit when purchasing a home?

As a resident, depending on the cost of the home and length of time given to pay back the mortgage a deposit may be requested. As a non resident a deposit is requested.

What additional costs can one expect when purchasing a home?

When purchasing a home, one can expect:

  • Monthly Premiums for the different Insurances taken out.
  • Notary charges
  • Closing fees
  • Realtor Agent’s Commission
What are the steps involved when purchasing a home?
  • When purchasing a home request information at your lending institution.
  • Plan your budget. Knowing estimated cost will help you in planning and keeping within your budget.
  • Apply for your mortgage
  • Fill out form for the insurance(s) required and get them approved.
  • Signing for the loan, and mortgage deed at the Notary office
  • The first monthly payment to be paid.
What types of insurance are associated with purchasing a home?

When purchasing a home you may want to look into the following Insurances:

  • Life Insurance
  • Personal Liability Insurance
  • Fire Insurance
  • Construction All Risk Insurance

Based on the amount I can borrow, what size home can I build?

The bank will give a guideline on the amount that can be spent per M2 which includes materials, equipment and labor.

Do I need to have an architect draw my house?

In most cases one may wish to have an architect draw a specific style, but you can also purchase an approved plan through Dienst Openbare Werken (DOW).

Do I need to make a deposit when building a home?

As a resident, depending on the cost of the home and length of time given to pay back the mortgage a deposit may be requested.

As a non resident a deposit is requested.

What additional costs can one expect when building a home?

When purchasing a home, one can expect the following additional costs:

  • Monthly Premiums for the different Insurances taken out
  • Surveyor’s fee
  • Utilities deposits (electricity, gas, water)
What are the steps involved when building a home?

When building a home you will need to request information from your lending institution.

  • Plan your budget. Knowing the estimated cost will help you in planning and keeping within your budget.
  • Acquire Land. (Property or Lease land)
  • Prepare architectural drawings of the house and submit them for approval by DOW
  • Choose a contractor and get a quote for building.
  • Apply for a mortgage at your bank or financial institution.
  • Fill out the necessary insurance forms, and get them approved.
  • Loan signing at the financial institution
  • Apply for a Water and Electricity meter
  • Have a confirmed date to start construction of the home.
  • Check with your lending institution on the first payment terms.
What is the cost per sq. meter (and sq. foot) for building a home?

Currently the going rate is Awg 1800 per M2 (US$1000). This can vary greatly with quality of materials used, and also depends on the contractor selected.

What is the difference between lease land and property land?

Lease land (erfpacht) is land owned by the Government on which a lease is granted for a long term (60 years), to a title holder. To obtain lease land, one can apply for at Domeinbeheer (Directorate of Land Administration). With lease land there is a yearly rent that has to be paid by the holder to the government.

Property land (eigendom) is land that is owned outright (freehold) by the title holder, and tends to be a more expensive. Property Tax (Grondbelasting) is charged by the Tax Department on the land and also the value of building the building constructed on it. The effective tax rate is about 0.4% of the land and property value after any exemptions.

What should be included in a contractor’s quotation?

The contractor’s quotation must include cost of materials and labor cost for every phase of construction. It should also include a delivery timeframe. It should be as detailed as possible and avoid ambiguity.

What types of insurance are associated with building a home?

When purchasing a home you may want to look into the following insurances:

  • Life Insurance
  • Personal Liability Insurance
  • Fire Insurance
  • Construction All Risk Insurance
Who is a surveyor and what are his/her functions during the construction?

A surveyor is a person who is qualified in construction inspection procedures who will visit the construction site after every phase of construction to inspect the quality of the building. The surveyor, when appointed by the bank, may also check that the amount of money allotted for each specific phase is being invested in the building.