How can you get a mortgage in Switzerland to buy property abroad?

For a Swiss resident, buying property abroad with bank financing is possible, but the solution is not necessarily a mortgage taken directly over the property being purchased. A Swiss mortgage for a property purchase abroad can take several forms: cross-border financing secured by the foreign property, an increase in the mortgage on a property already owned in Switzerland, a loan taken out in the country of purchase, or financing secured by other assets. The right structure depends less on your passport than on four factors: where the collateral is located, your affordability, the currency of the loan and the intended use of the property. Before signing a preliminary purchase agreement or paying a substantial deposit, it is therefore preferable to determine which financing structure is genuinely available.

The real issue is not that the property is abroad: it is the collateral

Saying that “Swiss banks do not finance property abroad” is convenient, but too simplistic.

A bank does not buy a house with you. It advances money against a risk that it must be able to measure, price and recover if the loan is no longer repaid. For a property in Switzerland, it knows the land register, mortgage certificates, valuation methods, enforcement procedures and the market on which the property could be resold.

With a property located 1’000 kilometres away, part of that mechanism changes: property law, registration of the security, mortgage rank, valuation, taxation, enforcement procedure and resale time.

The real question when seeking a Swiss mortgage for a property purchase abroad therefore becomes:

“Which asset will the bank accept as collateral, and how can it realise that asset if the loan is no longer repaid?”

This question opens up far more possibilities than a simple “yes or no” to a mortgage on a foreign property.

Two people wishing to buy the same EUR 500’000.– apartment in Spain can receive completely different answers. The first owns CHF 600’000.– in securities and a lightly mortgaged villa in Switzerland. The second has CHF 120’000.– in savings but no other assets. The Spanish property is identical; the banking risk is not.

Another particular feature: in some foreign markets that Swiss lenders know well, especially neighbouring countries, there are institutions able to take local security directly. For other destinations, a Swiss mortgage for a property purchase abroad will more often be structured against assets held in Switzerland.

This is precisely why a refusal from your usual bank does not necessarily mean that the project is impossible. Sometimes it simply means: “this financing does not fit our credit policy”.

The different ways to finance a property purchase abroad from Switzerland

Mortgage the foreign property directly

This is the most intuitive solution: the bank finances the house abroad and takes security over that house = the foreign property directly secures the loan, regardless of whether the financing bank is in the country of purchase or in Switzerland.

It will generally require more information than in Switzerland: a local valuation, proof of title, land register extract, building permit, any easements, insurance, tax position, purchase contract and sometimes certified translations of certain documents.

A mortgage for a property purchase abroad of this kind becomes easier to structure when an institution already knows the country and has the legal means locally to create and enforce its security.

But you need to look beyond the interest rate.

Imagine a bank that agrees to finance 70% of an apartment bought for EUR 600’000.–. You might conclude that EUR 180’000.– of own funds are required.

Not necessarily.

If the bank valuation comes to EUR 550’000.–, financing limited to 70% of that value produces only EUR 385’000.– of credit. You then need to provide EUR 215’000.– towards the purchase price, in addition to the costs that are not financed.

The financing percentage should therefore never be read without asking which value it is applied to.

This gap between the agreed price and the mortgage lending value is one of the points that can derail financing plans prepared with nothing more than a calculator.

Increase the mortgage on a property you already own in Switzerland

For a property owner in Switzerland, this is probably one of the most interesting structures to examine.

For example, you own a house valued at CHF 1’200’000.– with a remaining mortgage debt of CHF 450’000.–. There is a theoretical reserve between your debt and the value of the property.

That certainly does not mean that you can withdraw the difference as if from an ATM.

The bank will recalculate two figures: the loan-to-value ratio, meaning the debt in relation to the value it assigns to the Swiss property, and then affordability, meaning your ability to sustain the costs over time.

Suppose it ultimately agrees to an increase of CHF 200’000.–. With the bank’s approval, that amount can then be used to finance a property purchase abroad.

Here is the important distinction: the bank is not necessarily financing the foreign house; it is lending against your Swiss assets and providing you with liquidity.

The foreign property could even be purchased for cash while the debt remains legally secured by your property in Switzerland.

A Swiss mortgage for a property purchase abroad structured in this way can greatly simplify the local transaction, because the foreign seller receives funds rather than waiting for a foreign mortgage to be put in place.

But that simplicity comes at a price: you transfer the risk to your home in Switzerland.

If the foreign property loses 30% of its value, your Swiss mortgage does not fall by 30%. If you can no longer afford the debt, your Swiss property is the collateral at risk.

There is also a less visible risk: your Swiss “mortgage reserve” is used up. It will no longer be available, or will be much less available, to finance future works, an energy renovation, a co-owner buyout or a need for liquidity in retirement.

In other words, using CHF 250’000.– of mortgage capacity today has an opportunity cost for your wealth, even if the interest rate obtained looks attractive.

Take out the mortgage in the country where the property is located

If you want to borrow to buy abroad, a local bank may be the most logical solution: it knows the legislation, the land register, the valuers and the resale market.

The issue then shifts from the collateral to the borrower.

A foreign lender will need to understand a Swiss salary certificate, a Swiss tax return, the 2nd pillar, self-employed income or an existing mortgage in Switzerland. Some institutions have procedures designed for non-residents; others do not.

You also need to compare the amortisation system.

In Switzerland, a significant part of mortgage debt can remain in first rank for a long period. In several countries, a property loan for a purchase abroad operates more like an amortising loan: part of the principal is repaid every month.

A EUR 300’000.– loan at an apparently reasonable rate can therefore produce a much higher monthly payment than a comparable Swiss mortgage because you are repaying interest and principal at the same time.

Comparing interest rates alone is like comparing two cars by looking only at the price of fuel.

Hybrid financing: often where the solution lies

Interesting cases are not always financed with a single debt.

A buyer might, for example, combine CHF 150’000.– in savings, CHF 100’000.– from an increased mortgage in Switzerland and a local loan of EUR 250’000.–.

This structure has an advantage: each source finances the part for which it is most efficient.

But it also creates a risk that could be described as double real-estate leverage.

Suppose your Swiss home remains mortgaged while you simultaneously take on debt secured by your foreign house. A single fall in income must now support two financings, two buildings, two maintenance budgets and potentially two currencies.

A Swiss mortgage for a property purchase abroad should therefore never be calculated in isolation. The bank, and above all the buyer, need to look at the household balance sheet after the transaction.

Use a securities portfolio: the Lombard loan

For someone with substantial financial assets, another option is to pledge securities as collateral for a credit line.

This can avoid having to sell investments to finance the purchase. It can also serve as bridge financing when proceeds from a property sale or another inflow of liquidity are expected later.

But a house and a securities portfolio do not behave in the same way.

A house does not generally lose 20% of its market value between Monday morning and Friday afternoon. A portfolio can.

If the pledged securities fall in value and the collateral becomes insufficient, the lender may require repayment, additional security or the sale of assets. Heavily using a Lombard loan to buy an illiquid property therefore turns liquid wealth into debt that may demand liquidity at precisely the wrong time.

This structure deserves more attention than a simple interest-rate calculation.

Private lender, family and consumer credit

A family loan or a loan from a private mortgage lender can complement the structure, for example when there is a timing gap between buying the new property and selling another asset.

However, a proper agreement should be drawn up stating the amount, term, any interest, amortisation and repayment conditions.

A common mistake is to call this loan “own funds”. For the mortgage bank, borrowed CHF 100’000.– generally remains CHF 100’000.– of debt. It can therefore include the related repayments in your outgoings.

Swiss personal credit creates the same issue, more intensely. It can finance a relatively limited part of the project, but it is repaid much faster than a mortgage and, above all, is much more expensive.

Taking out personal credit just before applying for a property loan to buy abroad can therefore weaken your application rather than improve it.

A CHF 50’000.– shortfall in own funds is not necessarily solved by CHF 50’000.– of additional credit: you have replaced a liquidity problem with an affordability problem.

The calculations buyers should make before even contacting a bank

Test three balance sheets, not just one

For a Swiss mortgage for a property purchase abroad, the “everything goes well” scenario is the least interesting. You need to test what happens when several variables turn adverse.

Take a household with CHF 220’000.– in savings wishing to buy a house for EUR 500’000.–.

The right calculation is not simply about determining the amount you can borrow.

At least three situations should be modelled:

• normal situation: current income, current rates, no major repairs;
• stressed situation: lower income, higher interest costs and an unexpected property expense;
• exit situation: what happens if the property has to be sold quickly?

The third scenario is often overlooked.

Yet a second home in a small tourist municipality, an unusual property or a rural property may take much longer to find a buyer than a standard apartment in a major urban area.

Property liquidity indirectly influences the quality of the collateral.

This is one reason why two properties of identical value can lead a lender to offer different loan-to-value ratios.

Submit your questions now to receive information about your options for obtaining a property loan to buy abroad.

The trap of costs that cannot be mortgaged

To finance a property purchase abroad, you need to distinguish the cost of the project from the value of the property.

A transaction may include the purchase price, acquisition taxes and duties, deed costs, lawyer’s fees, valuation, intermediary fees, translations, works and sometimes certain bank charges.

A bank may agree to finance a proportion of the property value without financing an equivalent proportion of all these costs.

A EUR 500’000.– project can therefore require substantially more liquidity than the simple down payment calculated on EUR 500’000.–.

Your cash reserve after signing also matters. Using every last available franc for the purchase just to meet the minimum contribution is rarely a comfortable strategy when becoming a property owner in another country.

Choose the currency by looking at the full balance sheet

Another trap with a Swiss mortgage for a property purchase abroad is comparing CHF with EUR solely on the basis of interest rates.

In reality, three currencies need to be considered:

• the currency in which you earn your income;
• the currency in which your debt is denominated;
• the economic currency of the property and any rental income it generates.

A Swiss employee who owns a rental apartment in France may, for example, receive their salary in CHF, rent in EUR and have a choice between debt in CHF or EUR.

With debt in EUR, rent and the loan are partly aligned. With debt in CHF, employment income and the loan are more closely aligned.

There is therefore no universally “right currency”: one currency can reduce one risk while increasing another.

You should also test a substantial exchange-rate movement rather than mechanically extrapolating the rate observed on the day of purchase.

Pensions and tax: two details that can completely change the financing structure

The 2nd pillar can finance a home abroad… but not just any home

A frequently repeated statement needs correcting: 2nd-pillar assets are not excluded simply because the property is abroad.

The Federal Social Insurance Office explicitly states that an advance withdrawal can finance a home located in Switzerland or abroad when it is the insured person’s main residence. A second home is excluded. The minimum advance withdrawal from the 2nd pillar is CHF 20’000.–, and other conditions apply, particularly concerning age, the spouse and the rules of the pension institution.

This distinction matters for someone preparing to move abroad.

You live in Switzerland and buy a villa in Portugal solely for holidays: the 2nd pillar cannot be used for it in the same way as for your main residence.

If, by contrast, you are preparing to move your effective domicile to that villa, the analysis changes.

The property’s actual legal use therefore needs to be established before pension assets are counted among the available funds.

For pillar 3a, early access is likewise based on acquiring a home for your own use. The relevant foundation or insurer should confirm eligibility and the required supporting documents before the amount is included in the financing plan.

A mortgage on your Swiss home can have a tax effect linked to your foreign property

This is probably one of the least intuitive aspects of the financing.

Suppose you increase the mortgage on your Swiss main residence by CHF 200’000.– and use the money to buy a house abroad.

It would be tempting to think:

“The debt is secured by my Swiss house, so the interest remains entirely linked to my Swiss house for tax purposes.”

That reasoning may be wrong.

In an international tax allocation, debts and debt interest can be apportioned between Swiss and foreign assets. Vaud tax instructions notably require foreign properties, the debts encumbering them and debt interest to be declared separately; they also provide for an imputed rental value for a foreign property occupied by its owner.

The practical effect should be modelled before choosing the loan structure: the place where the bank took its collateral and the place to which a debt is allocated for tax purposes do not necessarily follow the same logic.

Financing should therefore be compared after tax, not only before tax.

And this calculation is going to change again.

On 28 September 2025, the Swiss electorate and cantons approved the reform of owner-occupied property taxation. The Federal Council has since set its entry into force for 1 January 2029. The imputed rental value of owner-occupied homes will be abolished; the scope for deducting debt interest will be sharply restricted and calculated in particular according to the share of rented or leased real estate in total assets.

For someone taking out a Swiss mortgage today for a property purchase abroad over ten or fifteen years, 2029 is therefore not a distant date. It falls within the financing period itself.

A strategy that appears tax-efficient in 2026 should therefore not be assumed to remain identical after the system changes.

In what order should property financing abroad be prepared?

The wrong order is: find the house, sign, pay the deposit, then call your bank.

If you want to borrow to buy abroad, it is preferable to proceed in the opposite order.

Start by drawing up a precise financial inventory: income, financial assets, Swiss real estate, existing mortgages, savings capacity, immediately available liquidity and any pension assets that may be usable.

Then determine which assets could serve as collateral. This step lets you distinguish three families of cases early on: financing secured directly by the foreign property, financing secured in Switzerland, or a hybrid structure.

Then have your affordability tested before committing to a price.

Once a property has been identified, the file should bring together documents relating to the borrower, the assets, the property and the transaction.

But there is a fifth file that is often forgotten: the funding timetable.

You need to know exactly when the reservation, first deposit, balance of the purchase price, taxes and fees are due. A banking solution may be perfectly viable financially but unusable if the funds cannot be released on the date required by the foreign contract.

This is particularly important when an increase in a Swiss mortgage, the sale of another property or the realisation of an investment is expected to provide part of the capital.

A clause making the purchase conditional on obtaining financing must also be reviewed under the law of the country concerned. Never assume that a foreign financing clause protects you in exactly the same way as one you know in Switzerland.

This is where a mortgage broker adds the most value: not by sending the same loan request to ten banks at random, but by identifying the type of lender that fits the structure of the case.

For a Swiss mortgage for a property purchase abroad, a bank specialising in cross-border financing, a private bank, a conventional mortgage lender and a local bank do not necessarily look at the same asset or the same risk.

Are you considering a purchase abroad? A preliminary analysis of your borrowing capacity, available collateral and the different financing structures can identify realistic solutions before the project becomes contractually binding.

FAQ: property financing from Switzerland to buy abroad

The starting point for a Swiss mortgage for a property purchase abroad should therefore not be “which bank offers the best rate?”, but “which structure uses my assets and income most robustly while protecting my Swiss wealth?”.

Disclaimer: The information on this page is general and does not constitute a credit offer or personalised legal, tax, financial or pension advice. Financing options, tax rules, restrictions on property acquisition and collateral requirements vary according to the country, lender, tax residence and personal circumstances. Any cross-border property transaction should be checked with competent professionals in the relevant jurisdictions.

Main sources: Federal Social Insurance Office, “Promotion of home ownership using occupational pension assets”; Vaud Cantonal Tax Administration, section on foreign properties, debts and debt interest; Federal Council / Federal Department of Finance, reform of owner-occupied property taxation.