In order to ensure that the purchase of your new home will not be an excessive financial burden, you should finance at least 20% of the market value with your own capital. In addition, you can increase this equity with credit balances from the 2nd pillar (e. g. pension fund, vested benefits account) or 3rd pillar (e.g. 3rd pillar savings, policies). However, 10% of the deposit must consist of your own assets.

You will receive the remaining 80% of the necessary capital from us in the form of mortgage financing provided the affordability criterion has been met. Financing for two-thirds (up to a maximum of 80%) must be amortised on a straight-line basis within 15 years (or at the latest by retirement age).

When it comes to determining whether your home is affordable, it is worth observing a simple rule of thumb: The total costs for mortgage interest rates, repayment, possible loan costs, maintenance costs and service charges (heating, electricity, water, repairs etc.) should not exceed one third of your gross income.

Zuger Kantonalbank applies an imputed interest rate of 5% at present to ensure that the financing remains affordable for you even during phases of high interest rates.

Mortgage interest and repayments represent the biggest annual costs. By repaying part of the mortgage you offset the reduction of your retirement assets and create reserves for future investments. You also reduce your financial commitments for the time when your pension income will be lower than your current earned income.

Depending on the age and condition of the property, service charges and maintenance costs normally amount to between 0.8% and 1% of the purchase price.