Calculate Your Mortgage

In Switzerland, a mortgage is first calculated based on the relevant lending value of the property and the available equity. The starting point is not the purchase price alone but the lending value (Belehnungswert), which the bank derives conservatively from the market value. From this follows the maximum financeable share, usually up to about 80 percent of this lending value. The remainder must be provided as equity, with a minimum portion of so‑called hard equity not allowed to come from the pension fund. In addition, acquisition incidental costs such as notary, land register and, depending on the canton, property transfer taxes apply and must be taken into account in the budget.

In Switzerland, "Tragbarkeit" (affordability) refers to whether a household can afford the ongoing costs of a mortgage over the long term. Banks deliberately use conservative assumptions: they don’t just check current interest rates but calculate with an elevated, so‑called assumed (stress) interest rate, add an annual amortization, and apply flat rates for maintenance and ancillary costs. The aim is to ensure the financing remains stable even in less favorable interest rate phases and with realistic operating costs.

"Belehnung" refers to the relationship between the mortgage debt and the relevant value of the property, expressed as a percentage. This relevant value is called the lending value (Belehnungswert). It is not simply the purchase price but a conservatively determined figure used by the bank; it is oriented to market value but may include safety discounts. Because the mortgage is secured by a lien on the property, the lending ratio determines how much third‑party capital the bank provides and under what conditions.