Mortgage: FAQ

By a turnkey property we mean a property that has not yet been built and which you want to buy ready for occupancy at a certain point in time. In the construction phase you do not act as a general contractor.

If this initial situation is given, the financing can be done with a VIAC mortgage (provided that all criteria for the property and you personally are met).

Please note that when financing the turnkey property, you will have to pay all down payments yourself (no financing through VIAC mortgage). If more than 20% was paid down, the difference cannot be reclaimed through the VIAC mortgage. The mortgage payment is made as a one-time final payment at the time of turnkey handover.
Because all payments prior to the final payment are made from your own funds, you alone bear the risk that the property will be completed by the general contractor.

If your property is to be financed in the general contractor relationship with several payments (tranches), this is not possible by means of VIAC Mortgage. In this case, please contact the credit team of Bank WIR (Tel. 0800 947 947 / Team 3).

If you expect mortgage interest rates to rise or you want to refinance your expiring mortgage, you can fix your interest rate up to 1.5 years before payment. In this case, a surcharge (so-called forward) is added to your interest rate. The surcharge applies if the payment of the mortgage takes place in more than 3 months and is calculated according to the current market situation.

The forward is currently 0.02% per month, whereby the first three months are free of charge.

Example: Fixing interest rate in 6 months results in a forward of 0.06% (3 months free plus 3 months at 0.02% each).
If the current interest rate is e.g. 1.00%, your effective interest rate will be 1.06% per year for the whole term if you fix the interest rate 6 months in advance.

If you have completed the Quick-Check and would like to send the application form including the necessary enclosures to bank WIR, you have two options:

• Send an email to viac-hypothek@wir.ch and attach your documents in PDF format (no zip files or links). Please note that we can only receive emails up to a maximum of 45 MB. If necessary, you can send the attachments in several emails.
• Send the documents by post to:
  Bank WIR
  Credit team
  Auberg 1
  4002 Basel

The VIAC Quick Check is an initial check of your mortgage eligibility. Criteria such as the type of property, the financing structure and the loan-to-value ratio as well as an initial rough affordability calculation are carried out. A positive result of the Quick Check is a prerequisite for proceeding with the mortgage application and subsequently submitting the documents for a regular review.

Important: Positive feedback from the Quick Check does not constitute a definitive financing commitment. Only after the regular review of the mortgage application by Bank WIR and the dispatch of the contract documents is the commitment definite.

Using the Quick Check in the VIAC web version (for computer or tablet), you can independently check whether you are suitable for a VIAC mortgage. Criteria such as type of property, the financing structure, the loan-to-value ratio and an initial rough affordability calculation are carried out. The following criteria must also be met in order to benefit from the VIAC mortgage offer:

1. Criteria: Personal
• Individuals between 18 and 60 years of age
• Borrowers with Swiss citizenship or residence permit B or C
• VIAC Pillar 3a or VIAC VB client (if more than one borrower, at least one must be a VIAC client).
2. Criteria: Property
• Property is considered a primary residence or will be used as a primary residence after purchase
• Owner-occupied: The property is 100% owner-occupied
• Existing or turnkey property
• Renovation costs up to max. 10% of the property value
• Property in Switzerland
• Property value max. CHF 2.3 million
• No value-reducing easements / encumbrances (right of abode, right of use, parcel in building lease)
• Excluded:
• Vacation homes
• Yield properties or partially rented properties
• Construction projects or properties under or with planned reconstruction (costs > 10% of the property value)
• Properties abroad or in the canton of Ticino
3. Criteria: Financing
• Maximum 2 borrowers
• Loan-to-value max. 80% (20% own funds can be provided by pledging)
• Calculatory affordability must be given
• Mortgage must be between CHF 100'000.- and 1'840'000.-
• Only total financing is permitted (excluded: subsequent financing)
• Payout / financing date must be in 1.5 years at the latest.

The mortgage sum does not have to be financed as a whole. The sum can also be divided and financed differently. The respective division of the mortgage sum is called a tranche.

Example:
Total mortgage sum: CHF 800'000
1st tranche: CHF 400'000 - fixed mortgage 10 years
2nd tranche: CHF 400'000 - fixed mortgage 5 years

With the VIAC mortgage, only total financing can be carried out. This means that the entire mortgage amount must be financed and not just individual tranches.

The loan-to-value ratio is the ratio between the mortgage amount and the market value of the property in percent.

Example:
- Market value of the property: CHF 1'000'000.-
- Hard equity: CHF 200'000.-
- Mortgage amount: CHF 800'000.-
- Loan-to-value: 80% (CHF 800'000.- / CHF 1'000'000.-)

Gross loan-to-value vs net loan-to-value:
Gross loan-to-value is the mortgage amount that is secured only by the property. The net loan is the total loan secured by the property and additional collateral (pledge of the 2nd and / or 3rd pillar).

Example:
- Market value of the property: CHF 1'000'000.
- Pledged own capital: CHF 200'000.-
- Mortgage amount: CHF 1'000'000.-
- Net loan-to-value: 80% ((1'000'000 - 200'000) / 1'000'000)
- Gross loan-to-value: 100% (1'000'000 / 1'000'000)

With the VIAC mortgage, the maximum net loan-to-value ratio is 80%. If you provide enough additional collateral, the gross loan-to-value can be up to 100%.

Note: the higher the loan-to-value ratio, the higher your income must be to guarantee the affordability of the mortgage.

Before you receive a definitive mortgage commitment, Bank WIR checks your creditworthiness and your borrowing capacity. The borrowing capacity is determined on the basis of an affordability calculation. The affordability calculation shows the relationship between your income and the running costs of the property. Running costs include: Mortgage interest, additional costs, amortization payments, other costs. This calculation is based on an assumed interest rate rather than the effective mortgage rate. The assumed interest rate is higher than the effective interest rate and is intended to ensure that a property is affordable for you as the mortgage holder even in the event of a mortgage interest rate increase.

If the affordability is not given according to the VIAC Quick-Check, you can contact Bank WIR. The credit team of Bank WIR will look at your individual situation with you and check whether there are alternative solutions for you to realize your dream of owning your own home (Tel. 0800 947 947).

The mortgage lender is Bank WIR. Bank WIR checks your creditworthiness and opens a mortgage account in your name in case of financing. You therefore also become a customer of Bank WIR. At VIAC, you only perform the quick check for the mortgage.

You can ask all questions about the mortgage directly to Bank WIR. The mortgage will not be visible in the VIAC app or on the web version (for now). This will be implemented in a further expansion of the offer if there is sufficient demand.

No, the VIAC mortgage is not a digital mortgage. You perform the VIAC Quick Check digitally. You can then send the VIAC mortgage application form and the necessary documents to Bank WIR by post or e-mail. After the mortgage check, Bank WIR will send you the mortgage and base contracts by mail. You, in turn, must hand in these contracts including a certified copy of your ID (for this you will receive a voucher so that you can carry out the certification free of charge at any SBB or post office counter) at a Bank WIR branch or send them by post.

Yes, you can replace an existing mortgage with a VIAC mortgage. However, the VIAC mortgage must be redeemed within the next 1.5 years. Please note that in most cases an early termination fee will be charged if you want to replace your mortgage before the end of the agreed term.

The displayed mortgage interest rates are continuously adjusted to the current market rates. As soon as Bank WIR receives the complete mortgage application from you, your interest rate will be fixed according to your chosen mortgage model. Relevant for the interest offer is therefore the receipt of your complete mortgage application by Bank WIR.

Important: the submitted application must be complete. If the documents are incomplete or incomprehensible, interest rates may change depending on market developments.

Tip: Submit your documents by e-mail. This way you will get a timely response and confirmation.

Early mortgage completion: If you expect mortgage rates to rise or you want to refinance your expiring mortgage, you can fix your interest rate up to 1.5 years before the payout. In this case, a surcharge (so-called forward) is added to your interest rate. The surcharge applies if the payment of the mortgage takes place in more than 3 months and is calculated according to the current market situation.

The displayed interest rates are issued by Bank WIR. These are indicative rates, which may change based on market developments. You will receive your definitive interest rate when you have submitted the complete mortgage application to Bank WIR.

Marital property regimes govern the allocation of property between spouses during marriage, but also how property is distributed in the event of divorce or death.

In Switzerland we know three marital property regimes:

1. Acquired property:
   If no marriage contract has been concluded, the acquired property regime applies (ordinary marital property regime)
• Spouses remain owners of their own property. The personal property includes goods that one already owned before the marriage and that one has received as a gift or inherited during the marriage
• Acquisitions are managed independently. For example, salary and interest are counted as acquisitions
• In the event of separation, death or a change in the marital property regime, the acquisitions are combined and divided in half
2. Community of property::
• If the spouses wish to pool their assets, a marriage contract is required. This must be certified depending on the canton of residence
• In the event of separation, the assets are divided in half each
3. Separation of property:
• If the spouses wish to keep the assets separate, a marriage contract is required. This must be certified depending on the canton of residence
• In case of separation or death, there is nothing to distribute, as nothing has been merged

When you conclude your VIAC mortgage, you become a client of Bank WIR. Bank WIR will open a bank account for you, which is required for the interest charges of the mortgage. In order to open this customer relationship, Bank WIR requires a certified copy of your identity document in accordance with FINMA requirements.

Important: For you as a VIAC customer there are no costs for this mortgage account, it is free of charge.

Money Market Mortgage:
With the money market mortgage, the interest rate is based on the SARON® (Swiss Average Rate Over Night) and an individually agreed surcharge.
The SARON® is an overnight interest rate that is applied in short-term credit transactions between two parties (usually banks, i.e. repo transactions). Every three months an average interest rate is calculated from these daily rates, which will be charged to you together with the individual surcharge. The SARON® is calculated and published by SIX Swiss Exchange AG. In case the SARON rate is negative, the basis for your mortgage rate is 0%.

Fixed-rate mortgage 5 / 10 years:
With the VIAC Fixed Mortgage you can fix the interest rate for the next 5 or 10 years. This way you can exactly plan your interest costs for this period. If the mortgage rates on the market increase during your term, this will not affect you. However, if the interest rates would decrease on the market, you cannot profit from this interest rate development.
Only when the term comes to an end will you be able to either repay the mortgage or extend it at the then current interest rates.

Your annual income can be made up of different components. Here we show you what these components are and where you can find the corresponding figure:

• Fixed salary: The fixed salary is your basic income, which you earn from your job. If you receive the same wage every month, you can enter the gross wage from your monthly pay slip. It is important that you indicate whether you receive 12 or 13 monthly wages. Alternatively, you can also enter the total from your annual wage statement (digit 1).
• Variable salary: The variable salary includes salary components that are not part of the basic salary and can fluctuate in total. These can be, for example, gratuities (bonus), commissions and lump-sum expenses. Here you should record the average of the last three years. You must also be able to prove where the amount comes from. This can be done, for example, by means of wage statements or pay slips for the last three years.
• Other regular income: This refers to types of income such as sustained income from securities, child allowances, alimonies, etc.

If you receive the message that you cannot be offered a VIAC mortgage after completing the Quick Check, it has something to do with your details. Take a look at the criteria catalog and check if any of your information is not eligible for the VIAC mortgage according to the criteria catalog.

You can fill in the Quick Check as often as you like. This means that you can always click on "back" and adjust your data.

If the result is not positive even after adjusting your information, you can contact Bank WIR. The credit team of Bank WIR will look at your individual situation and check whether there are alternative solutions for you to realize your dream of owning your own home (Tel. 0800 947 947).

In order to finance your property with a VIAC mortgage, you must contribute at least 20% of the property's value in equity. This 20% does not necessarily have to be composed of liquid assets. You can also use your pension assets for this purpose.
According to the applicable minimum requirements of SwissBanking, a minimum share of own funds of 10% is required for owner-occupied residential property, which does not originate from the 2nd pillar ( early withdrawal and pledging). This means you can use your VIAC 3a account as collateral for this 10% and pledge it.
The remaining minimum capital can be pledged to your VIAC vested benefits account as additional security. So you use your VIAC 3a and VB accounts as collateral to have your property financed at 100%.
Note in the case of a pledge: If there is a shortfall in the additional collateral (e.g. as a result of sharp fluctuations in the price of securities) up to the time the loan is suspended, a corresponding additional contribution of own funds must be made.

Example:

If you cancel your VIAC mortgage before the end of the agreed term, you will have to pay an early termination fee.
The amount of this compensation depends on the remaining term, the mortgage amount and the reference interest rate, among other things.
If you want to cancel your VIAC mortgage early, please contact the credit team at Bank WIR (Tel. 0800 947 947).

If you have any questions, the credit team at Bank WIR will be happy to help you on 0800 947 947. You can simply call with any questions to clarify your concerns. It is not necessary to make an appointment.
There are no on-site consultation appointments for the VIAC mortgage.