Minimum amortisation: definition
The minimum amortisation rate stems from the rule requiring you to bring your debt down to 65 % of the property value within 15 years (or before retirement).
Mandatory minimum amortisation
This means setting a minimum annual amortisation amount on the portion of the mortgage between 65 % and 80 % loan-to-value. Below 65 %, amortisation is no longer mandatory, but it can still be sensible.
Example of minimum amortisation
For example, you finance 80 % of a property worth 1 000 000 CHF, i.e. 800 000 CHF. You must amortise 150 000 CHF (80 % → 65 %) over 15 years, i.e. an average of 10 000 CHF per year in principal repayment.
Articles related to amortisation
- Adjust your monthly payments in relation to your amortisation
- Link between your amortisation and your equity
- Simulate your loan
