Mortgage calculator
CHF
CHF
CHF
23.53%
Shareholders' equity
76.47%
Mortgage
23.53%
Shareholders' equity
76.47%
Mortgage
Mortgage required:CHF 650’000
Entente rate:29.85%
Acceptable
Index
0 min
It's essential to calculate the cost of a mortgage, to know how viable your case is. To find out how much your mortgage costs, you can use a calculator, which will also tell you the eventual rate of the loan. Calling in a financial advisor can provide you with much more precise data.
In Switzerland, a mortgage is a common way of accessing home ownership. It allows you to take out a loan, using a property already owned by the borrower as collateral for the loan. Very reassuring for the banks, this approach is nonetheless sometimes difficult to grasp.
What are the costs associated with a mortgage?
To anticipate all the expenses associated with a mortgage loan, it's important to understand what the costs of the operation are made up of. Some costs can be negotiated with banks or insurance companies. For others, you may have to arrange financing to save money.
The amortization of the loan
Most of the time, the monthly payment is mainly made up of the amortization of the loan. It's really what you pay back, to acquire the property for which you took out the loan. There are exceptions, however. If you have opted for repayment, you will only repay this amount when the loan matures. Your monthly instalments will mainly be made up of interest.
The interest rate on a mortgage
The interest rate is, in a way, the remuneration you pay to the lending organization in exchange for the loan. It is expressed as a percentage. It follows the guidelines of the Swiss National Bank and will also reflect your bank's commercial policy. In other words, it is possible to negotiate this interest rate, within the limits of the indications given by the Swiss National Bank.
The interest rate is monthlyized. This means that it is paid over the entire term of the loan.
Notary fees
If you buy a property with a mortgage, you will also have to pay notary fees. These include the taxe de publicité foncière, the contribution à la sécurité immobilière and the notaire's fees. Finally, the cost of mortgage searches and VAT are added to the total of what are known as notary fees.
In general, these are paid at the time of acquisition of the property. It is also possible to include them in the sum borrowed.
The cost of insurance for a mortgage
Insurance is not always an obligation, when you choose a mortgage. In fact, repayments are guaranteed, thanks to the pledge of the property you wish to own.
Nevertheless, it remains advisable to take out insurance for other reasons. In particular, it can cover you in the event of death, unemployment or incapacity for work. It's also about protecting your assets, by ensuring repayment of your loan should anything happen to you. You protect yourself and your loved ones.
As a rough guide, insurance can cost between 4% and 5% of the price of the property. The cost of insurance can be spread over the entire term of the loan.
Why calculate how much a mortgage costs?
Planning your budget
Calculating the cost of a mortgage is an absolutely essential step in determining your project. It will give you a concrete idea of how much your investment will cost, at the time of purchase. You'll also be able to calculate the precise monthly cost of your acquisition, to avoid any nasty surprises. As you can see, this is an essential step that must be carried out with the utmost care.
Respecting the debt ratio for a mortgage
If you've already looked into mortgages, you should know that the maximum debt ratio accepted is 33%. This means that the total of all your loans must not exceed 33% of your annual income. Whatever your standard of living or income, this threshold must not be exceeded.
Calculating the cost of the mortgage is therefore an essential step, to make sure you meet this criterion. If this is not the case, your project will probably be turned down by the banks.
Fortunately, there are solutions. In particular, you can contribute your own funds to your project, to reduce the amount borrowed. You can use your savings or even the amounts guaranteed by your 3rd pillar pension.
How to calculate the cost of a mortgage?
The mortgage calculator
There are Swiss calculators, to let you know how much a mortgage costs. The most beautiful ones take into account an average interest rate, observed on the market. By entering the sum you wish to borrow, or the amount of your personal contributions, you can obtain a simulation of the budget you'll need for your mortgage.
The calculator can go even further, allowing you to obtain an estimate closer to reality. Most of the time, calculators using data specific to your project will provide this kind of information. For example, if you have to answer a questionnaire relating to your professional situation, your income or even the characteristics of the product, you will potentially obtain a personalized rate.
Please note that simulations carried out via this type of tool do not have the value of an estimate made by a finance professional. It is not a substitute for analysis of the file by a bank or lender.
Call a financial advisor to find out the cost
A financial advisor can really help you obtain much more factual data. Thanks to various partnerships with banking organizations, he or she knows and the rates that can genuinely be offered to you in branches. He or she will also carry out an in-depth analysis of your profile and your project.
He or she can also help you obtain useful insurance at the best price. He will also advise you on the viability of your project, even before you have submitted your file to a bank.
The financial advisor to put together the mortgage project
What is the purpose of a financial advisor?
Financial advisor has much more than a role in anticipating the blows of the mortgage. For this operation, he goes far beyond what a simple online calculator can offer.
He can also truly give you the benefit of his expertise, to analyze your file and optimize it. This will give you the best possible chance of getting your project accepted. They may also know of financial packages that can help you make valuable savings.
Moreover, calling on a financial advisor means you don't have to waste time canvassing several banking organizations while still putting together your file. In general, this type of professional offers you a turnkey solution, and will come back to you with genuine proposals.
Our expertise
If you're looking to apply for a mortgage, don't hesitate to call on our services. We can help you calculate the cost of your mortgage or negotiate the rate of your loan. While calculators can give you an initial estimate, they are no substitute for the expertise of a financial professional. We are at your disposal to provide you with personalized support, from start to finish.
Updated on: 31.01.2024Written by Valery ChantepyHead of mortgage department at CompareaTo learn more about our team click here.