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Old 12.10.2016, 12:40
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Mortgage for an investment property (Permit B)

Good Morning everyone,

I'd like to ask your advice on a business matter. I have located a property in Poland that I could buy and lease to businesses and would like to finance it with a mortgage. Is there a place in Switzerland that would provide one for

1. A property in Poland
2. That is an investment, not residential
3. For a holder of a B-type resident permit?

Best Regards,

Chris
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Old 12.10.2016, 12:50
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Re: Mortgage for an investment property (Permit B)

From my experience: difficult. Most banks prefer to finance in-country only, unless you are a HNW client

Chances on getting a local financing might be higher.
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Old 12.10.2016, 13:09
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Re: Mortgage for an investment property (Permit B)

Have you talked to local (Polish) banks/companies ?
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Old 12.10.2016, 15:51
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Re: Mortgage for an investment property (Permit B)

I have tried speaking to local Polish banks, but they are all heavily regulated - for example, "for my own safety" I am only allowed to take a mortgage in the currency that I earn in, and only one (1) bank in the country that has about 37 million inhabitants even considers having a mortgage loan in CHF in his offer. And they don't want to accept the building as collateral since it is an investment - if I wanted to live in it and "throw money at it" every month it'd be fine, but if I actually earned some monthly income from it (more than the mortgage payment would be) it is somehow "riskier" Bizarre.

So it will be next to impossible without going there and negotiating with branch managers in person, which is why I decided to investigate if some easier options exist here in Switzerland.
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Old 12.10.2016, 16:23
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Re: Mortgage for an investment property (Permit B)

Your nationality might come into play as well. If you're non-EU then the banks know you might not stay in Switzerland or the EU long-term. As such there's a risk they would have trouble tracking you down for payments. For Swiss banks, it would be costly for them to try and take the property if you default and leave CH/EU. Those are risks they might not want to take. If you're American you can pretty much forget it from the start.
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Old 12.10.2016, 16:42
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Re: Mortgage for an investment property (Permit B)

That's understandable. I'm Polish (so EU, at least for now)
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Old 12.10.2016, 16:53
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Re: Mortgage for an investment property (Permit B)

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That's understandable. I'm Polish (so EU, at least for now)
In that case, maybe try asking a Swiss bank that also has branches in Poland? i.e. UBS or Credit Suisse?
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Old 12.10.2016, 17:29
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Re: Mortgage for an investment property (Permit B)

I have tried that as well, UBS only has a "representation" and a service centre in Poland, no real branches that do actual banking, and Credit Suisse Poland would not take me as a customer as I am a resident of Switzerland. Lastly, Credit Suisse in Switzerland doesn't finance real estate abroad (with the exception of London and the Côte d'Azur).
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Old 12.10.2016, 17:52
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Re: Mortgage for an investment property (Permit B)

just start asking banks in switzerland. either one will say yes, or they will all say no and you have your answer.
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Old 12.10.2016, 20:48
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Re: Mortgage for an investment property (Permit B)

when i looked at buying in another country (not Poland) Swiss banks would not do it because they can not sieze property in another country if you do not pay the mortgage. you'll have to come up with something else for collateral.
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Old 12.10.2016, 20:49
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Re: Mortgage for an investment property (Permit B)

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And they don't want to accept the building as collateral since it is an investment - if I wanted to live in it and "throw money at it" every month it'd be fine, but if I actually earned some monthly income from it (more than the mortgage payment would be) it is somehow "riskier" Bizarre.
While the building is a security on a mortgage, the circumstances around a building being a family/primary home or an investment property can mean different risk profiles.

As you have a B permit, and need to take a mortgage in CHF, you have only a guarantee of being able to even earn CHF for the limit of the B permit. Thigns can and do change. If you have a CHF loan, but have to leave CH, the risk is higher that you couldn't afford to meet the payments.

A local loan is about the only reasonable way it would work, or else being a Swiss citizen with permanent residency/settlement, to get a CHF loan and the assumption you are staying forever in CH.

A 5 year work permit for a ~ 20 year mortgage (or whatever it is) doesn't sound like an easy sell!
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Old 12.10.2016, 20:53
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Re: Mortgage for an investment property (Permit B)

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As you have a B permit, and need to take a mortgage in CHF, you have only a guarantee of being able to even earn CHF for the limit of the B permit. Thigns can and do change. If you have a CHF loan, but have to leave CH, the risk is higher that you couldn't afford to meet the payments.

A local loan is about the only reasonable way it would work, or else being a Swiss citizen with permanent residency/settlement, to get a CHF loan and the assumption you are staying forever in CH.

A 5 year work permit for a ~ 20 year mortgage (or whatever it is) doesn't sound like an easy sell!
I took out a EUR loan (long term) on a property abroad and had a B permit. You need to be aware of the currency risk in doing that, similar to taking out a CHF loan for a property in a non CHF country.

I did have a good amount of savings and the interest etc to pay on the loan is not high so the bank thought the risk to be acceptable.

So it not only depends on your permit but also on your risk appetite and your personal income and savings.
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