Payback is important
At best, the whole project is? Buying a house through a mortgage? Carefully considered and secured from the start. Debt should be reduced until retirement to a level that can easily be borne even with a low income. At best, the entire mortgage is paid off by that time. Only then is it possible that your own property can really be inhabited even in old age.
Most mortgage borrowers choose indirect amortization for the repayment of the mortgage, in which the amount of the debt remains the same over the entire term. Accordingly, interest rates are always the same and do not adjust either up or down. The fixed amount is not paid to the mortgage lender, who does not receive any tranches. Rather, the amount in question is paid into pillar 3a of the pension scheme, which has a positive tax effect.
Because: Both the interest payments and the payments into the retirement savings account can be tax deductible. The money that has been saved here will later be used to repay the mortgage debt. In the best case, the calculation is such that the mortgage has dropped so far that interest no longer represents a burden in old age.
It is also possible to pay off the mortgage completely or to pay it off even after retirement. Your own life situation is just as important for this as the financial options that can be used. For all mortgage takers, it is therefore particularly important that they take out high mortgages as young as possible so that they really have the chance to repay the money up to their old age.
In addition, the right mortgage strategy should always be used, because this is crucial for the success of the project? Buying a house through a mortgage ?. Against this background, it is always important that a comparison of the providers is made before the mortgage is taken out, as is possible via neotralo.ch.
Simply pass on your own home?
In old age, even with good planning, it can happen that the costs for the property can no longer be borne. If you do not want to part with your property, you can now pass it on to your own children (or to other relatives). This is also possible if the property is still burdened by a mortgage.
It is therefore mandatory that the mortgage lender approves the transfer. The former owners can still keep the right of residence, but this should be entered in the land register and notarized. A registered usufruct is also possible.
If the parents have passed the house on to their children, they must pay tax on the rental value and, conversely, are exempt from all other obligations.
The children are responsible for all payments related to the mortgage and must therefore pay the interest. In the event of usufruct, the parents can dispose of the property almost without any restrictions, can even rent it and use the income from this rental as income. But you also have to pay taxes, bear the additional costs, interest on the mortgage and insurance costs.
The children are solely responsible to the mortgage lender and can be used if the interest payments fail to materialize. However, you can also take this over entirely. However, this procedure has a disadvantage: the usufruct is entered in the land register and reduces the value of the property.
Tips for real estate in old age
It all depends on the right planning: whether you can still live in your property in old age and take out the mortgage depends on the planning and the choice of the right mortgage strategy. The following tips should help to secure the property in old age:
Plan in time
When you reach the age of 55 at the latest, you should check whether your property is still viable when you retire. This leaves you with a few more years to make changes and increase savings in the 3a pillar or to amortize the mortgage. If you are unable to do this yourself, contact your bank advisor, who can calculate the amortization for you.
Save, save, save
The current low interest rates will probably not last long and then rise slowly. For you, this means that you should save as much as possible now. After retirement, you can then use the saved capital to amortize the mortgage. However, keep a reserve of cash and cash equivalents, because there can always be unforeseen expenses. You should still be able to contest these, because after retirement it is difficult or impossible to top up the mortgage again. Therefore: Do not use all of your own funds to amortize the mortgage!
Finance with the right partner
The portability is improved if all liquid funds are included in the income. To refinance the mortgage, some providers use less than five percent portability. Be sure to seek advice from an independent broker who is not interested in selling the products of a particular bank.
Check reverse mortgage
After retirement, it affects quite a few mortgage borrowers: their mortgage is no longer affordable. Then the only thing left to do is to take a reverse mortgage. An example of this is the real estate rent, in which the property itself is set as security. With a reverse mortgage, the debt burden increases with each passing year, and the loan is repaid when the borrower dies or when the property is sold.
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