The optimal mortgage in 8 steps

1. Calculate affordability

The first step is a reality check. Calculate conservatively: The imputed interest costs (5%), amortization, and maintenance costs (1% of the property value) should not together exceed 33% of your gross income. This secures your financing even during periods of high interest rates.

2. Define your equity strategy

Analyze your savings. How much cash, pillar 3a assets or pension fund assets (pillar 2) do you want to contribute? Bear in mind that an early withdrawal from the pension fund will reduce your future pension benefits. Pledging these assets can be a sensible alternative.

3. Prepare your documents for the lender

Prepare your documents professionally. These include your current salary statements, tax returns, a recent debt collection register extract, as well as all property data (land register excerpt, plans, photos, property insurance certificate). A complete file leads to a quicker binding commitment.

4. Compare different providers

Don't limit yourself to your main bank. Compare offers from major banks, cantonal banks, insurers and pension funds. Each institution has different risk profiles and offers varying conditions depending on the mortgage term.

5. Choose your mortgage model

Decide on a strategy:

• Fixed-rate mortgage: Fixed interest rate for a term of usually 2 to 15 years. Offers full budget security.
• SARON mortgage: Money market-based mortgage with a variable interest rate. Historically often cheaper, but it requires a higher risk tolerance if rates rise.

6. Set the amortization plan

The 2nd mortgage (everything above 65% of the property’s mortgage value) must be repaid within 15 years or by the time you retire. Choose between direct repayment (the debt decreases continuously) or indirect amortization via pillar 3a (to make use of tax advantages).

7. Review and sign the loan contracts

Once you have chosen a partner, you will receive the loan contracts. Check the clauses for notice periods, early repayment penalties and any possible additional fees. By signing, you lock in your terms.

8. Issuing the mortgage certificate

The mortgage is secured by a mortgage certificate. If there is not yet a suitable mortgage certificate on the property, it must be newly issued or increased in value by a notary. This provides the legal security for the bank to disburse the loan.