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-   -   Property purchase rules 10% cash and 10% pension...? (https://www.englishforum.ch/finance-banking-taxation/294032-property-purchase-rules-10-cash-10-pension.html)

plm987sdf 10.09.2019 12:41

Property purchase rules 10% cash and 10% pension...?
 
Hey, so a quick one.. Normally you need to have 10% cash and 10% pension money for the purchase of property.. What if I found something which could be covered easily by the pension money? It would easily make up 20% of the needed funds for example... Is that allowed?

Phil_MCR 10.09.2019 13:01

Re: Property purchase rules 10% cash and 10% pension...?
 
i think the rule is min 10% cash. but you can add 20% pension on top if you like :)

Medea Fleecestealer 10.09.2019 13:31

Re: Property purchase rules 10% cash and 10% pension...?
 
Are you sure Phil? I thought they'd limited the amount of pension money you could put towards property purchase to 10%.

https://www.ch.ch/en/financing-homeownership/

plm987sdf 10.09.2019 13:51

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by Medea Fleecestealer (Post 3099361)
Are you sure Phil? I thought they'd limited the amount of pension money you could put towards property purchase to 10%.

https://www.ch.ch/en/financing-homeownership/

Thanks for that link, it's quite clear here:

///
Pension fund savings: if you need a mortgage to fund the purchase, at least 10% of your own capital contribution must come from sources other than your pension fund
///

Thanks!

Belgianmum 10.09.2019 13:51

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by Medea Fleecestealer (Post 3099361)
I thought they'd limited the amount of pension money you could put towards property purchase to 10%.

https://www.ch.ch/en/financing-homeownership/

No, they made it so you have to have at least 10% as your own funds but didn’t limit what percentage the pension contribution could be.
The amount you can take from the pension is limited by how much you have in there, how old you are and the criteria set by the pension fund.

Guest 10.09.2019 14:06

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by plm987sdf (Post 3099331)
Hey, so a quick one.. Normally you need to have 10% cash and 10% pension money for the purchase of property.. What if I found something which could be covered easily by the pension money? It would easily make up 20% of the needed funds for example... Is that allowed?


No, it's up to your bank to ask for what they want, but as a rule of thumb you need a minimum of 10% in cash, it is far too easy to put down the 20% only in pension money.


And dont forget, you can only spend it once, so when you get to pensionable age, the less you will have ;)


Your age will also play a role in the amount you can use i believe.

Guest 10.09.2019 15:00

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

No, it's up to your bank to ask for what they want, but as a rule of thumb you need a minimum of 10% in cash, it is far too easy to put down the 20% only in pension money.
It is not fully up to the bank, law has set a minimum of 10% which one has to pay out of ones own cash.

Guest 10.09.2019 16:05

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

It is not fully up to the bank, law has set a minimum of 10% which one has to pay out of ones own cash.
Itís fully up to the bank if they want your business or not.

st2lemans 10.09.2019 16:25

Re: Property purchase rules 10% cash and 10% pension...?
 
3p counts as cash.

Tom

Guest 10.09.2019 17:24

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Itís fully up to the bank if they want your business or not.
Yes, but they are not free to ask what they want.

st2lemans 10.09.2019 19:10

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Yes, but they are not free to ask what they want.
Depends.

If the value exceeds the price, the percentages drop.

We only put up 30% for an interest only mortgage, for example, rather than the normal 35%,

Tom

Guest 10.09.2019 19:58

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by st2lemans (Post 3099507)
Depends.

If the value exceeds the price, the percentages drop.

We only put up 30% for an interest only mortgage, for example, rather than the normal 35%,

Tom

All true, but I am referring to the 10% cash on a mortgage.

st2lemans 10.09.2019 20:10

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

All true, but I am referring to the 10% cash on a mortgage.
It's not that you have to put down 10% cash, but rather that you can use the 2p for max 10%, so cash would be 10% only if you need to put down 10% of the purchase price, however the bank does need to require that you put down 20% of the purchase price.

Thus, if they decide that you only need to put down 15%, only 5% needs to be cash.

Tom

Guest 10.09.2019 20:23

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by st2lemans (Post 3099521)
It's not that you have to put down 10% cash, but rather that you can use the 2p for max 10%, so cash would be 10% only if you need to put down 10% of the purchase price, however the bank does need to require that you put down 20% of the purchase price.

Thus, if they decide that you only need to put down 15%, only 5% needs to be cash.

Tom

I can't find a source that agrees with you, to my knowledge it always has been like: 10% cash minimum which cannot come from P2, but there is no problem using money out of P3 for this, and 10% (or more if the bank demands such, but 20% total seems to be the minimum mostly.)) can come from whatever and there is no restriction of 10% max from P2

Phil_MCR 10.09.2019 21:32

Re: Property purchase rules 10% cash and 10% pension...?
 
OK. So I decided to check the rules again to see if they have changed since the 2014 rule changes:

https://www.finma.ch/en/news/2019/08...stregulierung/

EDIT: need to digest to understand changes.

New rules for investment properties seem to also include the old 2014 rules:

https://www.swissbanking.org/library...r_DE_clean.pdf

miniMia 10.09.2019 22:39

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by Medea Fleecestealer (Post 3099361)
Are you sure Phil? I thought they'd limited the amount of pension money you could put towards property purchase to 10%.

https://www.ch.ch/en/financing-homeownership/

No. You can use as much as you have available for purchase in your pension fund but also need minimum 10% cash.

Bexie 11.09.2019 09:56

Re: Property purchase rules 10% cash and 10% pension...?
 
Quote:

Originally Posted by Belgianmum (Post 3099370)
No, they made it so you have to have at least 10% as your own funds but didnít limit what percentage the pension contribution could be.
The amount you can take from the pension is limited by how much you have in there, how old you are and the criteria set by the pension fund.

quite, depends on the lendor as well. As a rule in Switzerland aver a certain age they want to see 36% without touching your pension


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