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Old 05.03.2017, 19:30
ivank ivank is offline
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Re: Loans [mortgages] in CH: Interest payments

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Just the opposite. Has all to do with the Eigenmietwert.
Wrong. Besides the fact that both affect your taxable income, there's no relationship between them

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It's the # 1 reason that loans never get paid off. Very big problem for folks in retirement and why they never pay off their mortgages.
Any loan is deductible! Mortgage is not special here

The rates are extremely low and are even lower after deduction, that's why nobody pays mortgages off. But if the rates would jump to the sky, that'll change pretty quickly.

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If I only pay 3000 chf in interest, how can it be that I do not get any principal when paying of the first 10 yrs mortgage?
How much principal you pay and how much interest will be in your contract. If you borrow 65% it's possible to have interest-only mortgage. If you borrow more, the bank will force you to pay back at least something every year until you're at 65%. The rule is you should at 65% after 15 years (possible spanning several refinances), so with 80% mortgage, repayment would be at least 1% per year. You can repay more quickly during refinancing.

At current rates however it does not make any sense to repay. Central bank's money is cheap. Your own capital is very expensive.
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