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Old 02.09.2020, 23:04
KashKau KashKau is offline
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Bank wants to charge negative rates to break mortgage!

So I had a misfortune of refinancing my fix mortgage for a few more years than I actually needed in hindsight. Due to personal circumstances I have to sell my property now, cancel the mortgage and face the infamous Vorfälligkeitsentschädigung.

Asked my account manager to compute it and here's the problem: the bank wants way more than the sum of all interests I would have to pay normally during the remaining years! About 0.4-0.5% more per year!

Looks like they are selling mortgages on the market now, collecting negative interest rates on swiss francs from the public market plus positive interests from homeowners. And now that I want out, they want both parts to let me go. And this is coming from a huge well-known swiss bank (well, not UBS and CS, but close), not some noname institution from the middle of nowhere.

The terms and conditions are weasely worded, but the relevant contract bit based on which they want the money seems to be this: "Der massgebende Prozentsatz pro Jahr entspricht dabei der Differenz zwischen dem im Zeitpunkt der vorzeitigen Fälligket geltenden Darlehenszinssatz und dem auf den selben Zeitpunkt erzielbaren Zinssatz für eine Anlage am Geld- und Kapitalmarkt mit entsprechender Restlaufzeit"

Is this s**t legal?

Has anyone went through the process of cancelling their mortgage in this era of negative rates? How was it handled? Did you manage to get them to at least waive the negative interest part?