Swiss mortgages are widely available to residents with stable income, offered by cantonal banks, major banks (UBS, Raiffeisen), insurers and pension funds, but lending is conservative: 20% minimum equity, affordability tested against an imputed long-run interest rate (typically around 5%, well above actual market rates) rather than the current rate, and amortization of the portion above two-thirds loan-to-value required within about 15 years. Foreign non-residents generally cannot get a Swiss mortgage for an investment property (tied to Lex Koller restrictions), but residents (any permit type with stable income) are treated similarly to Swiss nationals by most lenders.
The imputed affordability interest rate (well above actual mortgage rates) is the single biggest reason many otherwise well-paid relocators get turned down or offered a smaller mortgage than expected — it's designed to stress-test borrowers against future rate rises, not reflect what they'll actually pay.
Key Facts
Minimum down payment: 20% of the property's value, with at least 10 percentage points from genuine liquid savings (not pension withdrawal).
Affordability is tested using an imputed interest rate (typically ~5%, set conservatively above actual market rates) plus amortization and maintenance (often assumed at ~1% of value/year) — total should not exceed roughly one-third of gross income.
Mortgages are typically structured in two tranches: a first mortgage up to two-thirds loan-to-value (often interest-only, can be held indefinitely) and a second tranche that must be amortized (typically within 15 years or by retirement).
Fixed-rate mortgages (Festhypothek) for 2-10+ years are the most common product; SARON-based variable-rate mortgages are also widely available.
Residents with stable Swiss employment income and any permit type (B, C, L) are generally eligible; non-resident foreign buyers face much tighter restrictions tied to Lex Koller.
Steps
Get a mortgage affordability assessment — Banks calculate affordability using the imputed rate, not the actual offered rate — get this checked early in house-hunting.
Confirm equity sources — Ensure at least 10% of the purchase price comes from genuine savings, separate from any pillar 2/3a funds used for the rest.
Compare fixed vs. SARON variable rate products — Fixed-rate terms range from 2 to 10+ years; compare against variable SARON-based mortgages depending on risk appetite.
Plan second-tranche amortization — Budget for mandatory amortization of the portion above two-thirds loan-to-value, typically over 15 years.