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  #21  
Old 04.08.2020, 17:45
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Re: How to get a mortgage when on RAV but with cash?

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I can imagine the OP had many talks with Swiss local people.
Specially where i work (banking sector):

Why to rent a 2,5 for 2500 when you can buy a 5,5 for 1000/month since you just need to pay the maintenance.

But that is tricky. I heard that story for 9 years. True story; i threw away 30 000 * 9 chf in rent but i can leave any moment (not any moment but according to swiss law)
Because to get the mortgage on the 5.5 you need to put down (say) 200-400K, as a deposit, which on average nets you (say) 20-40k in investment income a year which covers the difference in rent.
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  #22  
Old 04.08.2020, 17:50
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Re: How to get a mortgage when on RAV but with cash?

A Moneypark.ch webpage discusses general options if a prospective mortgage borrower has been turned down by a lender (translated):

"A bank refused real estate financing because it was too risky. Do I still have a chance of obtaining the desired mortgage?

The answer to this question is clearly "yes". The following points explain why you can certainly hope to obtain financing from another bank:
  • Even though a affordability rate of 33% is generally regarded as the maximum value, there are still providers who offer mortgages even at higher values.
  • Some providers use an interest rate of only 4% instead of the usual 5% to calculate affordability - this difference may be the key to the balance.
  • The way irregular income, e.g. bonus payments, is included in the calculation of affordability varies from provider to provider.
  • Whether the chances of finding a job with a similar income are good when you lose your job plays an important role for some providers, while for others it is hardly taken into account.
  • There are providers who discriminate against young couples by expecting a loss of income due to maternity. However, many providers do not take this aspect into account.
  • There is the possibility to be assisted by family members or third parties. These can agree to joint and several liability or a guarantee.
https://moneypark.ch/news-wissen/hyp...f-einen-blick/
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  #23  
Old 04.08.2020, 23:26
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Re: How to get a mortgage when on RAV but with cash?

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We understood, but it seems you didn't. You said comparis said you couldn't get one; we just confirmed it.

If you're going to become unemployed the last thing you should be doing is looking to buy an apartment. As said, look for a cheaper one to rent or even just rent a room somewhere or sublet in someone else's property. Once you have a permanent job then you can look at buying.

And no, there's no guarantee you won't lose your job after a couple of months but if you suspect that might happen again you shouldn't be looking to buy in the first place. If it's not expected and happens, well that's a risk the bank takes when they decide to give you a mortgage. But they're not going to take a risk on an unemployed person maybe finding a new job here. Especially in the current coronavirus situation. That's just a risk too far as far as they're concerned.
I am not here to defend a specific idea on the contrary I look for different perspectives. It is clear that I am in a junction point and may not be as lucky as some of you who are reading this at this point in life. I find it hard to understand why ideas need to be transferred in a cynical manner.
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  #24  
Old 04.08.2020, 23:49
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Re: How to get a mortgage when on RAV but with cash?

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It depends on how much cash you have. Say you're looking to spend 500,000 and you have 300,000 plus maybe a 2nd and 3rd pillar pension pot. The bank may well loan you 350K but ask you to put the other 150k into one of their funds, as well as the pension pots.

Never say it can't be done. I've never had a "job" per se but always got mortgages - and many more than one - direct from the banks at good rates of interest.

It depends on how it's structured so my best advice is make an appointment with a few banks, for example Raiffeisen, the Cantonal bank and perhaps UBS. You'll get an idea of what they may be able to do. If one says no it doesn't mean the other will, so you've nothing to lose by trying..

Good luck with it.
You are the only one to wish me luck. First of all I thank you for this.
And this is what I exactly did. Actually visiting the bankers also created some other options. Having experience on buying a real estate in CH in the past, still a lot to learn. This is now a different status not only personally but also market wise. Things have changed in the recent years eg insurance vs bank loans etc. I have learned interesting structuring options to optimally create funding. Just requires a bit more preparation and research. RAV salary even if it can be for secured period of time is not so much counted so yes they really want to have a salary contract or some source of steady income from other means.
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  #25  
Old 05.08.2020, 00:10
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Re: How to get a mortgage when on RAV but with cash?

save even more money by buying a car and living in that. no need for a mortgage!
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  #26  
Old 05.08.2020, 00:12
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Re: How to get a mortgage when on RAV but with cash?

OP, although I broadly agree with what the others have posted, in thinking that it's unlikely that you would be granted a mortgage while you are unemployed, you're certainly to be commended for trying to see things in a different way. And you might find a way to prove that it can be done.

If I were in your shoes, I would do the research meticuously, and document everything thoroughly. (And yes, I do realise that you have done at least some of it, already.)

Since you aren't the typical candidate for a mortgage, any lender you approach may be similarly surprised to some of the posters here on this thread, that you could think that you might qualify for a mortgage. In other words, you may find yourself needing to try to persuade a robust, skeptical, atypical lender to even listen to your plan. In particular, be able to demonstrate, with supporting evidence, on what basis you state that owning would, for you, be cheaper than renting. Be ready to discuss the question of your defaulting on repayments, and that you understand what could happen then.

To do all this, be sure you know the field, for yourself, inside and out, so you can show them your relevant spread-sheets to answer any query.
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Old 05.08.2020, 00:13
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Re: How to get a mortgage when on RAV but with cash?

Gathering Capital
Can you live frugally for a while, (tiny room in low-end shared accommodation, never eat out) to save more so as to put down a more sizeable down-payment?
Can you find others who may share your dream, and encourage and teach each other about your project?
Does anyone owe you money, that you could now put some energy into recovering, from them?
Do you know private persons who would lend you money, if you are transparent with them about all your research (and about all the other private persons you'd approach)?
Read up about your pension plan capital (2nd pillar, BVG) and the circumstances under which you can extract part of that money to buy property.
Be very sure to understand how making such a withdrawal reduces your old-age pension, and investigate whether and how, if your financial situation improves later, you can pay in that money again, so as to fill the gap in cover.


Costs of being an Owner
Read up about not just purchase prices and mortgages, but the Swiss ways (and Cantonal rules) about dealing with all the extra, hidden costs of owning a property, such as, for example: clean water, dirty water (a cost of the owners, but not of tenants, in general), electricity (more than as a tenant, since you'll be co-funding the lighting in the common areas), the legally specified chimney-sweep within the legally specified periodicity, snow-ploughing, refuse, gardening, rules about tenancy (by you, by others), the levies for running the building (Stockwerkeigentum), including provision for major maintenance such as painting the building, re-roofing, marking parking spaces, or overhauling the heating system, etc., and management agents.


Versions of your Budget
Make several versions of your current budget, let's say a reasonable, then an economical version, and then a lean version.
How much of which everyday expenses could you willingly forego, to save more?
In those budgets, compare the costs of being a tenant very thoroughy with the costs of being an owner.

Understand the Swiss rules for vetting your ability to repay any loan, according to lenders' standard percentage-of-income formula. Is your lean budget so convincing (perhaps because you've proved that you can live on it for 6 months) that you might persuade a lender to believe that? Or does the law flatly prohibit lending in that range, anyway?


To Repay or Not to Repay
What would the costs be, for you, to arrange a mortgage with a flexible repayment? How much of which everyday expenses could you willingly forego, to squeeze more into repaying your mortgage?

Understand to what extent you can - depending on the rules of how repayment is permitted - influence what your monthly mortgage payment is, and the duration of the mortgage.

While in some countries (and individual circumstances) it can be advantageous to rush ahead and try to blatt that mortgage asap, in other circumstances it can be enough to pay only the interest, as many people in Switzerland do.


Know what it takes to Sell
Read up about the area, the local regulations and laws, the rules of the the complex, etc., to know what you would need to do to withdraw from a purchase agreement in the early stages, and also to sell.
Know what it would costs you, in terms of fees you may become liable to pay to the community of owners, to the bank, private lender or mortgage company, to the property registrar, to the tax office.
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  #28  
Old 05.08.2020, 00:15
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Re: How to get a mortgage when on RAV but with cash?

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save even more money by buying a car and living in that. no need for a mortgage!
Yes, many people do exactly this, in various places in the world. Do you know if it is possible in Switzerland, given that one must be registered at a municipality?
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