An interest rate swap (from English 'to swap' for exchange) is an agreement between two parties to exchange interest payments. In Switzerland, banks primarily use CHF swaps to hedge against fluctuating interest rates. If you take out a fixed-rate mortgage, the current swap rate is the bank’s “purchase price” for the money it lends you.

A mortgage is a loan secured by a property, guaranteed in the land register by a real-estate lien (mortgage certificate). It finances the purchase or construction of residential property, while equity covers the remainder. Terms such as interest rate (fixed or money-market-linked), term and amortization determine costs and flexibility. Banks therefore check loan-to-value and affordability to ensure the burden remains sustainable in the long term.

A mortgage is a specific loan that is always secured by real estate and is registered in the land register. It is generally used to finance the purchase, construction, or renovation of owner-occupied property and, because of the security, offers lower interest rates and longer terms. "Loan" is the umbrella term for any kind of lending, including unsecured personal or business loans. The main difference is the collateral and the resulting differences in terms, durations and processes.

You apply for a mortgage by clarifying budget, own funds and affordability, assembling the necessary documents on income, assets and the property, and obtaining offers based on the property valuation. After that you choose the interest model and tranches, negotiate terms and sign the contract; the mortgage deed and land register entry secure the loan, and the disbursement takes place at the transfer of ownership. A broker or independent mortgage specialist can compare offers, negotiate conditions and speed up the process, often achieving better terms and a more suitable interest strategy.