Calculate your mortgage costs and affordability.
Affordability checks if you can afford the ongoing costs of the mortgage. Banks often use a imputed interest rate (e.g., 5%) and ancillary costs (1% of property value). These total costs should not exceed one-third of your gross annual income.
In Switzerland, you generally need at least 20% of the purchase price as a down payment. A maximum of half of this can come from pension fund assets (2nd pillar), the rest must be 'hard' equity (savings, 3rd pillar, inheritance advance, etc.).
Banks typically calculate a flat rate of about 1% of the property value per year for maintenance and ancillary costs (heating, water, insurance, repairs, administration, etc.). This amount is added to the interest and amortization costs when calculating affordability.
Amortization is the repayment of the mortgage. In particular, the 2nd mortgage (the portion above 65% of the property value) usually must be repaid within 15 years or by retirement age. The annual rate is considered in the affordability calculation.