When people think of mortgages, they usually think of the bank. But it is not only banks that offer mortgages – many customers are unaware that insurance companies in particular offer mortgages at very favorable conditions.
Niche role of insurance companies in the Swiss mortgage market
The domestic mortgage market is dominated by the banks. The two big banks UBS and Credit Suisse and the group of cantonal banks have the largest market shares (about two-thirds). At the same time, it is becoming increasingly apparent that, for reasons of diversification, the cantonal banks in particular are more and more interested in providing larger financing outside their own catchment area. Raiffeisen banks have made strong gains in recent years, currently (2013) holding around 16% of mortgage receivables. The remaining 20% is shared by regional banks and savings banks, which generally operate only locally, and the other banks (including Migrosbank, Bank Coop and Postfinance). Since mortgage lending is not part of the core business of insurance companies, they play only a minor role in the Swiss mortgage market as a whole.
Interesting conditions for owner-occupied homes and MFHs
Often mortgage customers are not aware that insurance companies also offer mortgages. While insurance companies generally focus on so-called "standard financing" (i.e.h. Carrying capacity up to max. 33%, loan-to-value up to max. 80%, no construction financing, no luxury properties) – but especially for owner-occupied residential property or for multi-family houses, the mortgage interest rates offered are extremely attractive – so that the banks can often only keep up with difficulty.
Attractive offers for term mortgages
Term mortgages (also called forward mortgages) with lead times of up to 12 months are also particularly interesting, where the insurance companies sometimes even waive the term surcharge. The term surcharge is added to the "normal" interest rate and paid additionally over the entire term. With certain insurance companies, customers can extend their mortgage, which is not due to expire for another 12 months, today and secure the current (still historically favorable in 2013) interest rate conditions at no extra cost.
Uncomplicated change of provider to insurance
The bank usually grants favorable mortgages only on condition that the customer has other assets such as z.B. Salary account, savings account, pension account, securities account, etc. which means additional expense for the customer. It is easier to change insurers, because usually only the mortgage is opened. To pay the mortgage interest, the customer receives a deposit slip each time. In most cases, the customer does not have to transfer his accounts to the new lender, nor is he obliged to take out an insurance policy there.
More favorable interest rates thanks to more favorable refinancing
While the larger banks in particular raise capital on the financial market, insurance companies can easily obtain cheap capital thanks to the premiums paid by policyholders. This premium money is passed on to customers in the form of favorable mortgages and is currently a far more interesting investment opportunity for the insurance company than stocks and bonds. Which credit transactions the insurance companies are allowed to make and which not, is precisely regulated in the guidelines of FINMA.
Search immediately in our mortgage calculator for cheap mortgage from banks and insurance companies or contact us without obligation on the number 044 500 71 61 – our mortgage experts will be happy to advise you!