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Old 09.01.2017, 17:14
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Meadow Meadow is offline
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Re: Mortgage tips and risks

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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
How does this work? Do they regularly approximate the value of my property? How reliable is this?

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you need to be prepared to put on the table roughly 30%*80% = 24%
So let's run the numbers. Capital of 200, Mortgage 800. Flat value goes down from 1000 to 700 (who calculates that and how?). LTV is now 114%. We raise the capital by 240, the mortgage is now 560, LTV again 80%. Correct?

Bonus question: In what circumstances would modern flats in Zurich lose so sharp in value? Increasing interest rates? What was the cause last time?

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A disadvantage of the extremely long running fixed mortgages like 15 years is that you'll usually pay very heavy penalties
Understood. But what is a realistic scenario that would force you to sell? Even if you can't afford to pay the interest anymore, you just move somewhere cheap and rent that expensive flat to someone else.

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If she would be a co-owner of the property, I think that should work. Ask the banks.
would the pension of parents count as a valid income? Is their advanced age not an issue?

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How will the parents give thir daugther the 300k? As a gift or as a loan?
Definitely not a loan. They want to buy her a flat, or rather a part of it. Does it mean there would be tax? Then can they own the flat together and eventually she inherits it?

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Means she must either earn 105k or 144k.
She has a lower salary than that. I was thinking maybe the parents can use their pension for the Tragbarkeit?

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If she gets the loan it is very advisable to safe the difference between the actual mortgage interest and the hypotheical 5% and not use it for an easy, simple, happy life
Yes of course. I was already calculating that, not having to pay the rent, she could save about 40'000 per year. That's 600'000 after 15 years.
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