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Old 09.01.2017, 16:47
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Re: Mortgage tips and risks

There's a big risk of margin call. If house prices drop and the mortgage debt gets to be above 80% of the property's valuation, the bank can ask you to cough up more capital or sell, no matter how many years your fixed mortgage still has to run for.

In the last big swiss housing bubble the prices dropped by 30% or so. Should that repeat, you need to be prepared to put on the table roughly 30%*80% = 24% of the price in cash to complement your initial 20% downpayment.

A disadvantage of the extremely long running fixed mortgages like 15 years is that you'll usually pay very heavy penalties, should the circumstances change and you'd need to sell the house and get rid of it. Mortgage won't not stop if they die, it'll get inherited with the house.

One problem I am aware of is the Tragbarkeit
It's just a formal limit to how much cash the bank is allowed to loan out based on income.

The bank will not give out a loan based just on her income. The question is, can she take the mortgage together with her parents?
If she would be a co-owner of the property, I think that should work. Ask the banks.
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