mortgages in Switzerland

Swiss Mortgages

Mortgages, particularly to foreign investors, are still relatively new and some of the currently available options may not be as flexible as in the UK.

Mortgages in Switzerland

Get a Free Quote Swiss Mortgages - The Basics
Now that foreign investors are allowed to purchase property in Switzerland, it is no surprise that the mortgage industry has also expanded, in tandem, to offer a range of products for new, potential purchasers.

Typical Mortgage Terms
Mortgages, particularly to foreign investors, are still relatively new and some of the currently available options may not be as flexible as in the UK. However, the Swiss government is keen to ensure inward investment and, as such, is offering a range of concessions. For this reason, financing a property purchase through a Swiss lender should be considered, seriously.

Mortgages in Switzerland tend to be offered for only around 50 percent of the purchase price, although some lenders will go up to 80 percent in extreme circumstances. Interest rates in Switzerland are favourable in comparison to the UK, but only just, varying between 4 and 5 percent, on a regular basis.

The length of the typical mortgage term is anywhere between 5 and 30 years and this is available up to the age of 70, which may be particularly useful for the older investor who is not able to secure financing in the UK.

Obtaining a Swiss Mortgage
In order to receive a Swiss mortgage, it is necessary to prove a certain status to the lender. All lenders will need to know that the property you are purchasing is adequate in terms of security and that you can reasonably be expected to meet the mortgage repayments.

As a general rule, a Swiss lender will look at all your current liabilities including any mortgage or rental obligations, as well as personal loans and maintenance payments. Once all your liabilities have been taken into account, they should not exceed 30 percent of your gross income in order to be eligible for a Swiss mortgage. Percentages do vary between lenders, so it may be possible to find a more relaxed option, if you are struggling.

You will have to prove your income with information such as pay slips for the last 3 months, copies of bank statements for at least 6 months, an employer¡¦s reference and proof of any other income from investments. Some lenders will take potential rental income from the property into account. So, if you are finding it difficult to meet the 30 percent rule, it may be worth locating a lender that will take potential rent into account.

Summary
Bullet Point The mortgage market in Switzerland is undergoing substantial growth, with an influx of new foreign investors;
Bullet Point generally, it is only possible to borrow between 50 and 80 percent of the value of the property, although exceptions do occur;
Bullet Point lenders will consider all outgoings including other mortgages, before assessing the amount of available financing;
Bullet Point in some cases, potential rental income can be included towards total income for the purposes of affordability calculations.

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Typical Interest Payments

First Time Buyers

2.89%

Purchased Fixed

2.89%

Discounted Rate

2.99%

Buy To Let

2.99%

Commercial

3%

 

 

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