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Old 26.05.2020, 23:24
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Affordability threshold of 33% for mortgages...

Need some advice on getting a mortgage that would breach the 33% affordability index. Comparis calculator only states that *many* banks will not lend above this rate. I spoke with mine today and they themselves find the current stress test interest level to high... Perhaps one day they will change it.. But frankly I don't see interest rates going up anytime soon.. They didn't skyrocket during the boom for sure they won't be going sky high now either..

Anyway, that's beside the point for the moment.. Which banks does anyone have experience with who have no big issues going up to 40% level? Cash paid into the project is around 25% to 26% so that's a good position to be in, however, the affordability is a problem now. As it stands now, my rent is 2x what my mortgage would eventually be anyway....
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Old 26.05.2020, 23:29
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Re: Affordability threshold of 33% for mortgages...

Financial institutions are tied by law as for how much they are allowed to lent to people, nobody will give you a mortgage of 40%.
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Old 27.05.2020, 00:12
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Re: Affordability threshold of 33% for mortgages...

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Financial institutions are tied by law as for how much they are allowed to lent to people, nobody will give you a mortgage of 40%.
Yeah, I suspected as much... I know its not really up to them for some points..
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Old 27.05.2020, 08:27
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Re: Affordability threshold of 33% for mortgages...

Your best bet is with a mortgage broker who will probably get close to 40% using an insurance company super fund. The same rules don't apply to them.
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Old 27.05.2020, 08:36
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Re: Affordability threshold of 33% for mortgages...

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Your best bet is with a mortgage broker who will probably get close to 40% using an insurance company super fund. The same rules don't apply to them.
Oh, that's wonderful advice which is exactly what I was looking for...
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Old 27.05.2020, 09:08
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Re: Affordability threshold of 33% for mortgages...

This Handelszeitung article notes that Bank Cler will allow a debt sustainability (Tragbarkeit) of 38% and BEKB, Migros Bank and ZKB of 35%, at least in their survey. See the table in the article:

https://www.handelszeitung.ch/geld/h...abe-der-banken


Another source of a CHF mortgage can be from a Liechtenstein bank. For example, LLB indicates a maximum debt sustainability of 37% in its on-line calculator:

https://qwin.llb.li/llbrechner/app/e...im/tragbarkeit
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Old 27.05.2020, 10:20
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Re: Affordability threshold of 33% for mortgages...

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Need some advice on getting a mortgage that would breach the 33% affordability index. Comparis calculator only states that *many* banks will not lend above this rate. I spoke with mine today and they themselves find the current stress test interest level to high... Perhaps one day they will change it.. But frankly I don't see interest rates going up anytime soon.. They didn't skyrocket during the boom for sure they won't be going sky high now either..

Anyway, that's beside the point for the moment.. Which banks does anyone have experience with who have no big issues going up to 40% level? Cash paid into the project is around 25% to 26% so that's a good position to be in, however, the affordability is a problem now. As it stands now, my rent is 2x what my mortgage would eventually be anyway....
The Swiss don't pay off their mortgages so 'anytime soon' is irrelevant, the big question is will you still hit affordability in retirement, if you can't you will have a problem when any part of the mortgage needs to be renegotiated & probably have to sell the house.
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Old 27.05.2020, 10:29
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Re: Affordability threshold of 33% for mortgages...

This sort of nonsence (higher %) will just drive up house prices, but no-one will end in a better house. Theyll just pay more for the same...
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Old 27.05.2020, 10:32
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Re: Affordability threshold of 33% for mortgages...

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The Swiss don't pay off their mortgages so 'anytime soon' is irrelevant, the big question is will you still hit affordability in retirement, if you can't you will have a problem when any part of the mortgage needs to be renegotiated & probably have to sell the house.
I'm cool with that frankly... And your right, they don't.. One thing I do dispute is the calculation from my bauleiter (building manager). They included some extra fluff which isn't needed and they did agree to strip out some extra's. However, I still feel the estimate is overpriced for a bungalow of only 167sq meters with small garage under it...

We had to change the roof shape to gable style which created a huge volume of air and the cubic meters calculations then went through the roof, quite literally I guess. By creating extra air, somehow they think the cost has gone up. The previous roof would have been more complex to build and the house containing less air, thus the numbers were better.

Really at the end of the day, getting every estimate/quote might have been the best option to get an accurate picture here... Anyway, I'll try with some choices given and a broker.
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Old 27.05.2020, 13:35
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Re: Affordability threshold of 33% for mortgages...

OP,

Talk with multiple banks, Migros, kantonal etc included

IMO, There are three factors
Banks think :
Is the property worth it ?
Can this person continue to pay if interest rates touch 5% ?
Can person get 20% initial investment?

if two of three are good, 3rd can be worked on , and each bank would behave differently, just shop around , they could just agree with highest allowed threshold i.e 33-35% but may still be interested in financing.
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Old 27.05.2020, 15:06
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Re: Affordability threshold of 33% for mortgages...

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OP,

Talk with multiple banks, Migros, kantonal etc included

IMO, There are three factors
Banks think :
Is the property worth it ?
Can this person continue to pay if interest rates touch 5% ?
Can person get 20% initial investment?

if two of three are good, 3rd can be worked on , and each bank would behave differently, just shop around , they could just agree with highest allowed threshold i.e 33-35% but may still be interested in financing.
That's good advice.. The cler bank calculator shows I could even take more by the looks of it.. I am working with Clientis and Raiffeisen bank for the moment.. The general rule has been that they would like to finance at a level of 850chf per cubic meter and we are below that number... So thats a plus point I guess also..
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Old 27.05.2020, 23:41
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Re: Affordability threshold of 33% for mortgages...

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However, I still feel the estimate is overpriced for a bungalow of only 167sq meters with small garage under it...
only 167 m2.

That is a lot of space on one level.

Bungalows are quite costly to build. We looked into this extensively before finding one to buy which was already built.
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Old 28.05.2020, 09:46
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Re: Affordability threshold of 33% for mortgages...

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I'm cool with that frankly... And your right, they don't.. One thing I do dispute is the calculation from my bauleiter (building manager). They included some extra fluff which isn't needed and they did agree to strip out some extra's. However, I still feel the estimate is overpriced for a bungalow of only 167sq meters with small garage under it...

We had to change the roof shape to gable style which created a huge volume of air and the cubic meters calculations then went through the roof, quite literally I guess. By creating extra air, somehow they think the cost has gone up. The previous roof would have been more complex to build and the house containing less air, thus the numbers were better.

Really at the end of the day, getting every estimate/quote might have been the best option to get an accurate picture here... Anyway, I'll try with some choices given and a broker.
Given your thread in which you posted your other problem (betreibung), I wonder how you can move forward at all. Is everything covered by legal insurance??? If it were me I would want the court case resolved before getting myself into potentially further problems. It sounds like you already have issues with the new building company.

https://www.englishforum.ch/3182682-post1.html
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Old 28.05.2020, 10:04
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Re: Affordability threshold of 33% for mortgages...

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I'm cool with that frankly... And your right, they don't.. One thing I do dispute is the calculation from my bauleiter (building manager). They included some extra fluff which isn't needed and they did agree to strip out some extra's. However, I still feel the estimate is overpriced for a bungalow of only 167sq meters with small garage under it...

We had to change the roof shape to gable style which created a huge volume of air and the cubic meters calculations then went through the roof, quite literally I guess. By creating extra air, somehow they think the cost has gone up. The previous roof would have been more complex to build and the house containing less air, thus the numbers were better.
As you experience, charging for cubic meter is a method to rip off clients, you basically need to pay for thin air. I wouldn't accept such an offer. See how much it costs per square meter.

Get a few quotes from other companies. This way you can put pressure on them.
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Old 28.05.2020, 10:15
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Re: Affordability threshold of 33% for mortgages...

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Given your thread in which you posted your other problem (betreibung), I wonder how you can move forward at all.
I know people who got mortgages quite happily despite disputed betreibung. You have to be up front about it, but if they're happy that this is a case of disputed debt rather than willful breach, it can work.

Several betreibung from different sources is more problematic.
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Old 28.05.2020, 13:53
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Re: Affordability threshold of 33% for mortgages...

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I know people who got mortgages quite happily despite disputed betreibung. You have to be up front about it, but if they're happy that this is a case of disputed debt rather than willful breach, it can work.

Several betreibung from different sources is more problematic.
A significant betreibung, wanting to borrow more than would usually be acceptable? You don‘t think most banks would see red flags here?
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