I have been offered a job outside of Switzerland and I am weighting pros- and cons.
One item that I can not weight is the fact that I am owning a flat that I am paying under mortgage.
What would be the situation of that flat? Can I keep on owning it while being resident abroad, paying the mortgage? Would I be obliged to sell it?
Thanks in advance for your suggestions,
Best regards,
edo777
That’s a question for your mortgage lender.
Hint: There is no such law.
The relevant law is the " Lex Koller " or Bundesgesetz über den Erwerb von Grundstücken durch Personen im Ausland. And as the title indicates the purchase of real estate by foreigners is restricted but not ownership itself.
They were happy for us to fix the mortgage for a few years but won't extend beyond that if we aren't back. We have to keep an eye on making sure we can repay the bank when they want their money back or have a whip around
Another option is to keep the flat and rent it out. You continue to make the mortgage payments.
Lastly, you might want to see how your planned move goes before making any decisions about the flat.
Loan for 67% of property value. More is possible but it requires amortization payments.
Rental income ( expected) - 15% (NK and maintenance) should cover the costs of your mortgage at a 5% annual rate.
Just curious, why don’t you want to sell the property if you are moving?
Before buying, I've been doing my due diligence and found:
* With the canton, there is no issue of buying and then renting out later (as long as we lived there for a while as to not have been intended to circumvent Lex Koller which deals with *purchase* not *ownership* as mentioned above
* However, the two banks I checked with (UBS and CS) stated that once you leave Switzerland, the law does not allow them to continue the banking relationship (except in exceptional cases where you can prove a strong connection to CH).
Thus, the mortgage would be cancelled which could mean very large termination fees too and one would have to either repay the remainder or sell the property. Based on this, we are now at the point of not pursuing buying real estate.
Based on this, it seems too risky to buy a property knowing in a few years we may be forced to sell it (and also pay termination fees)
May I ask if anyone has specific experience with *any* banks which have different policies or interpretations (where one can continue to have a mortgage even when no longer resident in Switzerland?)
What bank did you have, so they accepted you as a non resident. May I ask for how long did you go on assignment? and did they increase your fixed interest rate for that ?
@edo777 I am in exactly the same situation. Want to accept the promotion outside of Switzerland, but not ready to give up my newly bought home. My bank do not work with non residence even if I live only for a assigment.
@gaburko How long was your assignments if I may ask? and which Bank do you use ? Lastly did they increase your interest rate for you not being resident any more ?
If you are a Swiss citizen you should be ok, try BCV as a bank.
First assignment was 3 years (in the EU) and second one was 2 years (not in the EU). Both cases my bank was properly informed, but as I continued to receive my salary here and kept my Swiss contract it was never an issue. No change to my interest rate. It's worth mentioning that I am on a C permit.
But morgage broker has told me that If I transfer my morgage from current bank to a new bank which works with non residents, I would pay a penalty of about 70k for early termination of the contract (total interest for the remaining time) and on top of that the new interest rate will be at least double of what I have now.
This seems like a vicious circle: I can not keep my current bank as they do not work with residents so I am forced to move to a different bank, and If I do so I will be charged with penalty fee and increase in interest rate.
All that for 2 years foreign assignment. Is there any way to solve it ?
Not easily....which bank we talking about ?