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Frequently asked questions about mortgages
- You must finance at least 20% of the value of your chosen property with your own equity. No more than 10% of this equity can come from your occupational pension.
- The total cost of interest, ancillary costs and amortization each year may not exceed 33% of your annual gross income.
Equity can come from many different sources, including:
- Money in your current and savings accounts
- Advance inheritance and gifts
- Securities and valuable items
- Unencumbered building land
- Funds from pillars 2 and 3
Money from the pension fund and pillar 3a may only be withdrawn in advance to buy or convert a home you will occupy yourself. You can fund up to 10% of the property value from your occupational pension fund, i.e., half of the required equity amount. You can use pillar 3a to finance the remaining 10%. In addition, you can withdraw or pledge equity from your occupational and private pension funds.
As a rule of thumb, the total monthly costs for your property should not exceed 33% of your gross income. This is the only way you can finance your property in the long term. These costs include:
- Imputed mortgage interest
- Amortization payments
- Maintenance and ancillary costs
Imputed mortgage interest is based on a long-term average interest rate of 5%.
When buying a property, at least 20% of the price must be funded using your own equity. Banks will finance up to a maximum of 80% as two separate mortgages:
- First mortgage: max. 67% of the property value
- Second mortgage: max. 13% of the property value
Unlike the first mortgage, you are required to pay back the second. You must pay it back within 15 years or until you reach retirement age – whichever comes first.
Interest varies depending on the mortgage and maturity. In our example, we assume an interest rate of 1.5%. Simply adjust the hypothetical interest rate in the calculator to find out how rising interest rates will affect your monthly costs.
We will be happy to help you find the right mortgage combination for you.
Maintenance and ancillary costs usually come to about 1% of the property value.
These include costs for water, electricity, garbage, heating and upkeep. Maintenance costs are expenses for keeping the property in good condition, for example, for small repairs and taking care of the surroundings and the garden.
The results generated by the mortgage calculator are based on the information provided, as well as on assumptions and approximate values. UBS does not accept any responsibility for the accuracy or completeness of the information provided, nor for the results of the calculations based on this information. The calculations are for information purposes only and are not binding. Any actions taken based on the calculation results remain the sole responsibility of the user. In particular, the results of the calculations must not be construed as a recommendation. UBS does not furnish advisory services with the mortgage calculator. The user themselves is responsible for interpreting the results of the calculations. Any liability on the part of UBS for damages resulting from the use of the calculator or from access to it is entirely excluded.
UBS has long-standing expertise in real estate purchases. Our regionally-based advisors can provide you with personalized advice to find the financing that suits your personal situation and wishes.