I+i topic debt note and ubs goes online for mortgages

Today I write from Dubai, a glittering and luxurious city, which unfortunately is also hardly ever quiet. Excavators and concrete mixers are constantly roaring, power generators and air conditioners are running. And where it would be quiet, I'm sure there's music playing.

The fact that the economy is doing well here is almost palpable. Hopefully this will remain so in the days of Brexit and the corona virus!

On another topic, two articles have caught my eye lately, or rather helped me along. One deals with the Swiss institution of the Schuldbrief, the other is about a new player in the online real estate market.

What does a promissory note actually do?

A promissory note is an indispensable instrument of real estate financing and is drawn up by a notary on behalf of the parties involved. Hardly anyone used to see it in paper form. With the electronic register debt certificate, this material debt certificate is now also a thing of the past.

The meaning and importance of a promissory note is explained perfectly in an article from cash and needs no further clarification here. Only this much: we too were hardly aware of the importance of the Schuldbrief when we first bought our property. Also z.B. not the consequences of losing a paper borrower's note after all mortgages have been paid off. I can imagine that a Schuldbrief occasionally no longer appears in the case of inheritance. Heirs then have to get a court involved and face high costs before they can dispose of a property.

Tip: Keep paper debt certificate properly and inform descendants in good time. Better still: Switch to the register debt certificate immediately, this is possible at the responsible land registry office.

UBS also wants to broker mortgages in the future

UBS is already a strong mortgage bank in Switzerland, and now it wants to broker mortgages online as well. To prevent this from competing with itself, it has created a complex business model, which in an article by Prof. Andreas Dietrich is explained and discussed and also needs no further words here.

Just my own take on this: I hardly know anyone where real estate financing really went smoothly and according to standard process. There were always stumbling blocks somewhere, minor imponderables and issues or popped up at some point during the process (or over the course of further decades of doing business). Then good advice on online relationships is expensive. In my opinion, a solid bank like UBS should be able to offer both: A viable business relationship AND good conditions. It would be wrong to outsource the good conditions to the online business and obviously exclude the branch customers with an affinity for advice.

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