Variable-rate mortgage loan

Our variable-rate mortgage loan lets you buy or renovate a home while retaining maximum flexibility on your mortgage payments. The ideal option when interest rates are high and you think they’ll go down. Because interest rates can fluctuate from one day to the next, bear in mind that they can also go up.

Highlights

Highly flexible

Our variable-rate mortgage loan does not have a set term, giving you maximum flexibility. The interest rate tracks variations in the capital markets, meaning it fluctuates throughout the term of your mortgage loan. You can switch to another type of mortgage loan at any time.

Taux variable

Minimize risk by combining interest rates

To reduce interest-rate risk, you can divide your mortgage loan into multiple tranches with different interest-rate conditions (fixed-rate, variable-rate, or Libor-linked). That can help protect you against higher interest rates when you renew your mortgage.

TauxLibor_CombinaisonTaux

Details

You can borrow up to 80% of the purchase price of your new home if it’s a primary residence, or up to 65% if it’s a secondary residence. That means you need to provide a downpayment of at least 20% or 35%, respectively. The money can come from existing cash assets or from your second- or third-pillar funds (these funds cannot be used to finance a secondary residence).

The interest rate agreement is open-ended. At any time, you can switch your variable-rate mortgage loan to a fixed-rate mortgage loan or a Libor-linked mortgage loan.

When you sign your loan contract, you can choose between the direct and indirect repayment methods. Payments are made quarterly.

 

Mortgage repayment

You can pay down your mortgage either directly or indirectly.

Direct repayment

With the direct repayment option, you make regular mortgage payments to BCV. These payments will be applied to the loan principal and interest, and your overall mortgage debt will decrease over time. However, your tax charge will increase every year since you can deduct only the interest payments.

 

Amortissement direct

Indirect repayment

With the indirect repayment option, instead of making mortgage payments directly to BCV, you put the money into a third-pillar retirement account that you pledge to BCV. This option offers some tax advantages: you can deduct the payments made to your retirement account from your taxable income; and you maximize the amount of your tax-deductible mortgage debt.

 

Amortissement indirect prêt hypothécaire

Fees and conditions

  • Maximum loan amount: 80% of the purchase price
  • Minimum downpayment: 20% of the purchase price
  • Maximum cost of mortgage and interest payments plus maintenance: 33% of household income
  • Minimum loan amount: CHF 100,000
  • The interest rate agreement has no fixed end date. 

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Useful documents

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Buying a home in Switzerland

Owning your home is more than just an investment: it is a major decision that should be carefully considered.

File size : 1.04 MB - Last update : 18 May 2018

Keywords: Achat/ Propriétaire/ Maison/ Logement

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