Can you borrow the full price?

No. The 20% equity rule comes from banking self-regulation followed by every Swiss institution: none finances 100%. A family loan can top up the deposit, but the bank will treat it as debt and fold it into the affordability calculation.

Is the 5% theoretical rate negotiable?

No, and deliberately so. It is not the rate you will be charged but the safety margin the bank imposes on itself: the loan runs for decades, and the point is to check you would hold if rates rose sharply. Unlike the actual rate, it is not up for discussion.

Can a foreign national get a Swiss mortgage?

Yes, provided the purchase itself is permitted: see our guide on residence permits. The conditions are often stricter: a larger deposit, a shorter term, and sometimes a requirement to bank in Switzerland.

Equity, pension fund and mortgage: financing a Swiss purchase

Updated August 2026

Two figures decide everything: what you bring, and what you earn. The first must reach 20% of the price; the second must absorb a charge calculated at a rate nobody currently applies. Many projects fail on the second while the first was in place.

1. The 20% equity, half of it "hard"

The bank finances at most 80% of the property value. The remaining 20% comes from you, but not from anywhere: at least half of it, meaning 10% of the price, must be so-called hard equity: savings, securities, a gift or a third-pillar account. The second pillar may only cover the other half. On a two-million property, that means 200,000 francs of real savings and 200,000 raised otherwise.

2. The second pillar: withdrawal or pledge

Your occupational pension assets may fund your main residence, never an investment property. Two routes: withdraw them, which cuts your capital and future benefits and triggers immediate taxation; or pledge them, which leaves the assets in place and simply raises the amount borrowed. Pledging costs more in interest but preserves the pension, often the better choice before fifty.

3. The affordability test: the real filter

This is where most refusals happen. The bank adds interest calculated at a theoretical rate: around 5%, whatever the market rate, plus amortisation, plus 1% of the price for upkeep. The total must not exceed a third of your gross income. At two million, that calls for an annual income above 400,000 francs, even though the actual monthly payment would be half as much.

4. Amortising down to two thirds

The debt must be brought down to 66% of the property value within fifteen years, or by retirement if that comes sooner. Direct amortisation reduces the debt and the interest but raises taxable income; indirect amortisation runs through a pledged third-pillar account, is tax-deductible, and leaves the debt untouched until maturity. The choice depends on your marginal tax rate more than on the amount.

5. What to prepare before viewing

A financing certificate obtained in advance turns an offer into a credible one: the seller knows you can close. It requires your last three payslips, your tax assessment, a statement of assets and a vested-benefits certificate. Allow a few days. Without it, a better-prepared rival file goes ahead of yours.

How much can you borrow?

Swiss banks set two limits: at least 20 % of the price in equity, and theoretical costs that stay below a third of gross income. This calculation applies both rules.

Use of the property

Purchase priceCHFEquityCHFAt least 20 % of the price, half of it from savings or pillar 3a rather than occupational pension assets.Gross annual household incomeCHFInterest rate%Used for the actual monthly cost. Banks themselves test your file at 5 %, whatever the current rate.

Property likely to count as luxuryAbove roughly 200 m² for a flat or 300 m² for a house, some lenders place the property in this category and finance only 60 % of its value. Plot size, finish and location count too, and lenders judge it differently.

Within the usual lending limits.

Mortgage: CHF 1'100'000
Loan to value: 73.3 %
Actual monthly cost: CHF 3'639
Share of gross income: 30.7 %

Interest at the rate entered, maintenance and amortisation included.

Theoretical costs, the bank's calculation

Theoretical interest at 5 %: CHF 55'000
Maintenance and charges at 1 %: CHF 15'000
Second-rank amortisation over 15 years: CHF 6'667
Annual total: CHF 76'667

Gross income required: CHF 230'000
Price you could finance with this income and equity: CHF 1'581'081

An indicative calculation based on the usual rules of Swiss banks. Each lender applies its own criteria and its own valuation of the property, which can be lower than the purchase price.

Talk about your financing

Frequently asked questions

Can you borrow the full price?: No. The 20% equity rule comes from banking self-regulation followed by every Swiss institution: none finances 100%. A family loan can top up the deposit, but the bank will treat it as debt and fold it into the affordability calculation.
Is the 5% theoretical rate negotiable?: No, and deliberately so. It is not the rate you will be charged but the safety margin the bank imposes on itself: the loan runs for decades, and the point is to check you would hold if rates rose sharply. Unlike the actual rate, it is not up for discussion.
Can a foreign national get a Swiss mortgage?: Yes, provided the purchase itself is permitted: see our guide on residence permits. The conditions are often stricter: a larger deposit, a shorter term, and sometimes a requirement to bank in Switzerland.

A question about your own situation?

Every file is different. Tell us about yours and we will tell you what applies.

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Financing a property purchase in Switzerland