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Old 22.06.2011, 07:38
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Urgent - Loan to buy apartment - are these good rates?

Hello,

I might be buying an app soon for 702k CHF and Loan of 535k CHF.

For the 535k, the bank is offering a 6 year fixed at 2.34% for the first tranche of 50% and 1% full variable (it says 3 months?) for the second tranche of 25% (the other 25% of the capital is my cash I already have). The BCV bank is giving me the same rate of Banque Migros, which i thought is the best offering in Switzerland?

Do you think it is a good proposition? I am a bit in a hurry and cant look for everything as i am about to sign on Friday at the Notary, would be nice if i get some tips from you expert-guys. :-)

Should I risk more and get a higher tranche of money lente at variable rate?

I dont understand why the Frais d'Entretien / Managing costs are 1% of the whole capital 702k? i thought it should have been on the lent amount??

Thanks!!
2funky
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Old 22.06.2011, 08:54
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Re: Urgent - Loan to buy app

personally I've never paid more than about CHf 3.-- to buy an app.

what are you using, one of them android phones?






EDIT... the OP, or one of those dang Mods edited the title to spell out "app." in full.

Last edited by grynch; 22.06.2011 at 10:17.
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Old 22.06.2011, 09:06
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Re: Urgent - Loan to buy app

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For the 535k, the bank is offering a 6 year fixed at 2.34% for the first tranche of 50% and 1% full variable (it says 3 months?) for the second tranche of 25% (the other 25% of the capital is my cash I already have). The BCV bank is giving me the same rate of Banque Migros, which i thought is the best offering in Switzerland?
Some banks still offer you two different interest rates for the repayment part vs. the balance you never pay off - don't accept this and find a bank that will deal with all your loan on an equal level.

I don't feel I can comment on what is good and is not, however, I will tell you that appart from the tranche that has to remain on the "shaft me now" (aka variable) interest rate, so that you can repay the loan, the others are all on LIBOR as this remains the lowest rate that bank COOP are offering us. This has a single opt-out clause that allows us to move to another product (interest rate offer) at any single point during the three years this is offered.

It is all about risk. If you think interest rates are going to go up - and I don't think they are, but I have no educated opinion on this - then lock your money into longer term products.
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Old 22.06.2011, 09:08
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Re: Urgent - Loan to buy app

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Hello,

I might be buying an app soon for 702k CHF and Loan of 535k CHF.

For the 535k, the bank is offering a 6 year fixed at 2.34% for the first tranche of 50% and 1% full variable (it says 3 months?) for the second tranche of 25% (the other 25% of the capital is my cash I already have). The BCV bank is giving me the same rate of Banque Migros, which i thought is the best offering in Switzerland?

Do you think it is a good proposition? I am a bit in a hurry and cant look for everything as i am about to sign on Friday at the Notary, would be nice if i get some tips from you expert-guys. :-)

Should I risk more and get a higher tranche of money lente at variable rate?

I dont understand why the Frais d'Entretien / Managing costs are 1% of the whole capital 702k? i thought it should have been on the lent amount??

Thanks!!
2funky
In general it's dangerous to take decision in a rush and under pressure. Take your time to get advice from experts.
You can use Comparis.ch to get market rates for your configuration. it will take you 10min to do it.
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Old 22.06.2011, 09:11
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Re: Urgent - Loan to buy app

you're signing with the notary on friday and you don't have your finance in place yet????
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Old 22.06.2011, 09:24
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Re: Urgent - Loan to buy app

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I might be buying an app soon for 702k CHF and Loan of 535k CHF.
You know the abbreviation for Apartment is apt and not app right?
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Old 22.06.2011, 09:26
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Re: Urgent - Loan to buy app

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You know the abbreviation for Apartment is apt and not app right?
french or italian native speaker...
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Old 22.06.2011, 09:43
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Re: Urgent - Loan to buy app

Try to check those LIBOR loans.

Currently, if you negotiate good enough, the rates you in the end pay to the bank are under 1%.
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Old 22.06.2011, 09:47
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Re: Urgent - Loan to buy app

Thanks for all the comments (including the ones about the App! ....

I am signing a "vente e terme" / time sell on Friday, where i have to put down 10% and i guess i have 2 months to check other plans for the mortgage.

As i dont know if the rates go up or down, i tend to choose 6 years fixed-rate plan and additionally a 25% of the loan with variable.
I think its a ponderate risk I am ready to take.

If i got already the fixed rate of banque migros, what could be the benefit of using comparis.ch (which costs 290 chf)?

anybody got ever better than them?
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Old 22.06.2011, 09:48
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Re: Urgent - Loan to buy app

What is a LIBOR loan? less than 1%?
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Old 22.06.2011, 09:49
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Re: Urgent - Loan to buy app

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It is all about risk. If you think interest rates are going to go up - and I don't think they are, but I have no educated opinion on this - then lock your money into longer term products.
I would disagree with this. I am also of the opinion that interest rates in Switzerland are not going up any time soon (note that fixed rates for 5 to 10 year loans have come down by about 0.4% over the last month or so), so why would you want to fix the rate now? Much better in my opinion is to take as much as you can on variable (3 month LIBOR) at 1%, and then keep an eye on the fixed rates over the next couple of years and fix once they start to increase. Otherwise you are paying 2.6% - 1% = 1.6% extra for nothing.

Of course this all depends on your risk appetite and how stretched this loan will leave you - fixing for the long term is essentially taking out insurance against interest rate increases, so that you know you can always pay the interest costs. As with any insurance, there is a cost.

Good luck deciding what you want to do.
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Old 22.06.2011, 09:50
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Re: Urgent - Loan to buy app

Just to let you know: the bank always makes sure they are in the winning zone (and most probably not the client).

So check out the options you have.

I would not necessarily say that you have made a good deal.

I'm currently in the same process as you, but negotiate with "iron fists".

It's my own money that goes away.
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Old 22.06.2011, 09:51
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Re: Urgent - Loan to buy app

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In general it's dangerous to take decision in a rush and under pressure. Take your time to get advice from experts.
You can use Comparis.ch to get market rates for your configuration. it will take you 10min to do it.
True

I also think it will be difficult to find better rates but even if you can shave off another 0.1% then what will you save? 50CHF per month gross?
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Old 22.06.2011, 09:51
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Re: Urgent - Loan to buy app

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What is a LIBOR loan? less than 1%?
LIBOR = London Inter-Bank Offered Rate.

It basically means that each 3 months the bank will increase or decrease the interest rate on your loan, depending on what the actually market rates are at that time. Currently LIBOR 3M mortgage rates are at around 1%, but if the Swiss National Bank increases rates then you will see your payments increase immediately at the end of the 3 month period you are in. Hence they are normally called variable loans, as the rate will vary.

Last edited by GenevaSculler; 22.06.2011 at 10:35. Reason: Offered, not Overnight. Thanks Economisto
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Old 22.06.2011, 09:57
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Re: Urgent - Loan to buy apartment - are these good rates?

We recently got a loan (6 months ago), 50 of the loan % at 1.45 % fixed for 5 years, 1.95 % fixed for 9 years.
We also used a broker who manged to shave a couple of points here and there saving us nearly 200 a month.
At the time the variable was about 1.2% but we wanted to be certain of what we would be paying so we didnt go for that option.
As it has been said before it all depends on your appetite for risk, of which I have no taste for at all, but I am a bit boring.....
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Old 22.06.2011, 10:01
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Re: Urgent - Loan to buy apartment - are these good rates?

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Hello,

I might be buying an app soon for 702k CHF and Loan of 535k CHF.

For the 535k, the bank is offering a 6 year fixed at 2.34% for the first tranche of 50% and 1% full variable (it says 3 months?) for the second tranche of 25% (the other 25% of the capital is my cash I already have). The BCV bank is giving me the same rate of Banque Migros, which i thought is the best offering in Switzerland?

Do you think it is a good proposition? I am a bit in a hurry and cant look for everything as i am about to sign on Friday at the Notary, would be nice if i get some tips from you expert-guys. :-)

Should I risk more and get a higher tranche of money lente at variable rate?

I dont understand why the Frais d'Entretien / Managing costs are 1% of the whole capital 702k? i thought it should have been on the lent amount??

Thanks!!
2funky
you can compare to ZKB and UBS:

http://www.zkb.ch/de/startseite/priv...ek/zinsen.html
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Old 22.06.2011, 10:04
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Re: Urgent - Loan to buy apartment - are these good rates?

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We recently got a loan (6 months ago), 50 of the loan % at 1.45 % fixed for 5 years, 1.95 % fixed for 9 years.
We also used a broker who manged to shave a couple of points here and there saving us nearly 200 a month.
At the time the variable was about 1.2% but we wanted to be certain of what we would be paying so we didnt go for that option.
As it has been said before it all depends on your appetite for risk, of which I have no taste for at all, but I am a bit boring.....
wow. i wish i'd gone to your broker. that's a great deal!
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Old 22.06.2011, 10:30
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Re: Urgent - Loan to buy app

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LIBOR = London Inter-Bank Overnight Rate.
O= Offered. It's the commercial borrowing rate in London at about 11am each day.
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Old 22.06.2011, 10:34
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Re: Urgent - Loan to buy app

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O= Offered. It's the commercial borrowing rate in London at about 11am each day.
Whoops.... Indeed.
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Old 22.06.2011, 19:29
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Re: Urgent - Loan to buy apartment - are these good rates?

you can check in www.comparis.ch
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