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Old 15.07.2014, 14:45
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Mortgages: 1 property, but mortgage tranches with different lenders

Hello, just wondering if anyone has taken a portion / tranche of their mortgage to another provider, leaving other portions with the original lender?

eg. 1million mortgage: 50% on 10yrs fix, 50% on 5 years, with lender A. After 5 years, then taking 50% / 500k to lender B

If so, anything special about the experience to note? Was the feedback of new lenders ok that they would only be getting part of the overall mortgage?

thanks for any input!
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Old 15.07.2014, 14:55
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

I tried this approach but all the lenders I tried wanted the whole property as security for the loan.

It is hard to split a property for security purposes. Imagine if you do not pay the loan and then say UBS want to sell their part and CS want to keep their part.
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Old 15.07.2014, 15:14
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

You can sometimes do it. It means having more than one "Schuldbrief" (security issued on the property). It is best done at the time you take out the initial loan because the holder of the Schuldbrief will be reluctant afterwards to allow it to be split.
(German)
http://www.nzz.ch/finanzen/uebersich...ich-1.18096228
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Old 15.07.2014, 15:14
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

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I tried this approach but all the lenders I tried wanted the whole property as security for the loan.
Same response to me when I asked, it is a question of risk for the lender.

Last edited by 3Wishes; 15.07.2014 at 15:27. Reason: fixed quoting
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Old 15.07.2014, 16:24
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

Interesting reading, thanks for the input.

And kinda confirms my fear that by signing up partially to a long term deal with one lender, even if only say for 30-40% for 10yrs, means you are generally stuck with them for the whole 10yrs, even when your other shorter tranches expire.

And I guess when their great rate for 60%-70% @ 5yrs they offered you is finished, they wont be so willing to do a great deal for you, when they know they have you anyway for another 5yrs on the 10yr deal.
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Old 15.07.2014, 16:29
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

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Interesting reading, thanks for the input.

And kinda confirms my fear that by signing up partially to a long term deal with one lender, even if only say for 30-40% for 10yrs, means you are generally stuck with them for the whole 10yrs, even when your other shorter tranches expire.

And I guess when their great rate for 60%-70% @ 5yrs they offered you is finished, they wont be so willing to do a great deal for you, when they know they have you anyway for another 5yrs on the 10yr deal.
Exactly, now you got it
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Old 15.07.2014, 16:45
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

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Interesting reading, thanks for the input.

And I guess when their great rate for 60%-70% @ 5yrs they offered you is finished, they wont be so willing to do a great deal for you, when they know they have you anyway for another 5yrs on the 10yr deal.
I have 3 tranches with different term dates. I have not found this to be the case when re-negotiating the tranches. If you think the rates are going to rise, you can forward fix the rate up to 24 months in advance.

I am with Credit Suisse.
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Old 15.07.2014, 23:24
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Re: Mortgages: 1 property, but mortgage tranches with different lenders

When negotiating the rate, it is better to negotiate a margin on the swap rate. That way it is possible to keep the same terms when negotiating a new mortgage.
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