A Comparis study shows that it is not always economical to acquire real estate with more than 35% equity.
Posted
It is better to be well informed before taking out a mortgage on your home.
Sabina Bobst/Tamedia
Mortgage institutions grant lower interest rates to people with good repayment capacity. To take advantage of this, buyers often bring in more equity than the required 20%. An analysis carried out by HypoPlus, the group’s specialized mortgage service Comparis, however, indicates that mortgage institutions barely grant additional rate discounts when the external financing ratio drops below 65%.
Bringing in as much equity as possible when buying real estate is therefore not advantageous. On the other hand, it is much more desirable that the external financing ratio does not exceed two thirds of the real estate value. In this case, the fall in the mortgage rate can indeed reach 25 basis points, according to a study released Wednesday.
Do not amortize too quickly
“This is explained by the high level of security provided by so-called first-rank mortgages. For these, the external financing ratio is limited to 65%, ”said Frédéric Papp, of Comparis, quoted in the press release.
Caution should be exercised when it comes to the amortization of a mortgage: “To amortize too much and too quickly, is to take the risk of not having enough cash available at the time of retirement to maintain one’s income. quality of life. In addition, during retirement as well as during the few years preceding it, it is often difficult to increase one’s mortgage», Warns Frédéric Papp.
