so, my offer for the flat was accepted and I have received something called "Kaufsbestätigung / Verkaufsverpflichtung". all exept one thing is clear in the document:

Grundpfandrechte: Schuldbriefe im 1-3 Rang total Fr.....
Schuldbrieferrichtungen gehen zu Lasten der Käuferin.

I have been trying to understand that sentence. Can someone explain it to me? thank you!

There are existing mortgages on the property, and you agree to take them over or pay for the cost of redeeming them.

At this point you need to know the terms of those mortgages before you sign.

Not quite...a schuldbrief is not the same as a mortgage. It's a debt certificate. It needs to be established in your name in favour of the bank with which you have your mortgage. The amount in the Schuldbrief does not have to be the same as your mortgage, but it has to be equal to it or greater.

Transferring a Schuldbrief from one person to another is not a big deal, but it costs money and will be done by the notary. If they are electronic (as many are nowadays) it may not be that expensive. If not, it could cost a few hundred francs. Best to ask the notary. Transferring a Schuldbrief is not a bad idea as it often costs less than setting them up new.

If your mortgage is likely to be higher than the total of the Schuldbriefe, you will need to top them up accordingly.

Thank you for the correction!

I checked our bills and for the electronic version transferring two Schuldbrief cost 100 CHF, I think this was actually just one charge. As they were less than our mortgage there was a charge of 1 per million of the extra amount for an additional Schuldbrief.

The discussion re. keeping the old mortgage(s) came in the next step.

Schuldbrieferrichtung means setting them up. If the creditor is the same you might want to merge them into one. And while you're at it, increase the nominal value. The bank won't exceed their safety requirements, whatever the nominal amount happens to be but increasing it now rather than later may be less expensive.

Consequence:
- one Schuldbrief (SB) instead of three is likely to affect the cost, and it will necessitate an adjustement of the Grundbuch. But that'll happen anyway with the purchase.
- no creditor will accept another creditor with the same SB as security, the ability to split the mortgage will be affected
- a lower ranking creditor will assume that the higher ranking SB is fully used regardless of the actual credit provided. That may affect their interest rate.

thanks for the first information. let's see what I will find out....

Yes, we took over the old one, as advised by our lawyer/notary.

Tom

I'm intrigued by the topic. I also suspect that no creditor will accept to have a Shuldbrief on the property from another creditor. So most likely that means:
A) The debt is going to be repaid at the moment of the transaction by the seller, you just pay for adjustment to the register (erasing that Shuldbrief)
B) You take over the mortgage - is that even an option??
C) You take a mortgage at the same creditor and if your mortgage is not higher than the Shuldbrief there's nothing to do



I'm also intrigued by the comment that one should want to increase it, why is so? Maybe, to have an option to draw more money from it by increasing the mortgage once the house value increases? I've heard that some people are actually following this strategy, once the house value increases they increase the mortgage to meet again only the minimum 20%, and use the "released" money to buy another property.

Correct. The deed's nominal sets the mortgage's maximum. To get an additional deed registered requires
- setting up a new (usually additional) schuldbrief
- having it added to the land registry entry

Both cost, and both can usually be done cheaper when the entry is already being altered (purchase).

One case I know of had the first ranking deed (set up in the 19th century) with 15k nominal and maximum 5% interest rate. Pretty useless nominal and minimal interest limit, if the bank can't get what it wants/eeds it'll simply give notice nowadays.