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Old 09.01.2017, 18:40
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ivank ivank is offline
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Re: Mortgage tips and risks

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How does this work? Do they regularly approximate the value of my property? How reliable is this?
Each bank probably has their own valuation methodology and own figures. Under normal market conditions, property slowly appreciates and they don't need to do anything. Only a large market-wide drop in prices should force the bank to take a closer look at their portfolio of mortgage debts and make the calls where necessary. You can check housing prices indexes, like ZKB's, to monitor when there's a downwards trend.

So let's run the numbers. Capital of 200, Mortgage 800. Flat value goes down from 1000 to 700 (who calculates that and how?).
The bank according to their own methodology.

LTV is now 114%. We raise the capital by 240, the mortgage is now 560, LTV again 80%. Correct?
Yes, if you can pay 240k, that should satisfy the bank.

Bonus question: In what circumstances would modern flats in Zurich lose so sharp in value? Increasing interest rates?
A big increase in interest price would affect the prices, yes.

For example at a 5% mortgage interest, current prices aren't very sustainable. You only make 3-5% currently in net rent (post NK), out of which you still have to pay maintenance, taxes, mortgage and keep some as a profit.

Definitely not a loan. They want to buy her a flat, or rather a part of it. Does it mean there would be tax?
If they give the money to her as a gift, it would be free of tax as a gift between parents and children. But this money would just reduce the amount she'd need to loan. She still needs to have enough income to afford to loan the remaining amount.

If they would co-own or sign up to be the guarantors, I guess their pension income can be considered by the bank in addition to the daughter's for the Tragbarkeit calculation.
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