The fixed-rate mortgage in Switzerland: complete guide 2026

The fixed-rate mortgage remains the preferred choice of Swiss homeowners. And for good reason: it offers total security on your mortgage payments for the entire contract duration. But which term should you choose? How are rates determined? This guide provides the answers.

Fixed rate in brief

With a fixed-rate mortgage, the interest rate is guaranteed and unchangeable for the entire contract duration. Whether market rates go up or down, your interest payments remain identical. In Switzerland, available terms generally range from 2 to 15 years, with some institutions offering even 20 or 25-year terms.

Current fixed rates: March 2026

A notable point: the 5-year fixed rate (1.09%) is currently cheaper than the 2-year (1.10%) in the best offers. This phenomenon, called yield curve inversion, reflects market expectations of a rate decline in the medium term.

How are fixed rates determined?

Contrary to a common misconception, fixed rates do not depend directly on the SNB policy rate. Here is the mechanism:

Swap rates: the market benchmark

Fixed mortgage rates are primarily determined by swap rates on the capital markets. A swap rate is the rate at which two parties exchange fixed-for-variable interest flows over a given term.

In practice, when a bank grants you a 10-year fixed rate, it "hedges" its risk by entering into an interest rate swap on the interbank market. The cost of this swap forms the floor of the rate it will offer you.

The bank margin

To the swap rate, the bank adds its margin, which covers operational costs, credit risk and its profit. This margin typically varies between 0.40% and 0.80% depending on the institution.

The role of bonds

Swap rates are themselves correlated with the yields on Swiss Confederation bonds and, more broadly, European and global bond yields. When markets anticipate more inflation or economic growth, bond yields rise, and fixed mortgage rates follow.

This is why it is possible for fixed rates to rise while the SNB lowers its policy rate, and vice versa. The two are not directly linked.

Advantages of the fixed rate

1. Security and predictability

This is the number one advantage. For 5, 10 or 15 years, your mortgage payments are known in advance. No surprises, no stress from market fluctuations. You can plan your budget with certainty.

2. Protection against rate increases

If rates rise after you sign your contract, you are protected. The 2022-2023 episode, when rates tripled in a few months, demonstrated the value of this protection. Fixed-rate holders felt nothing.

3. Simplicity

No need to follow the markets, calculate compounded rates or wonder when to convert. The fixed rate is the simplest product to understand and manage.

4. Tax planning

With constant mortgage payments, your tax deduction is predictable from one year to the next. This makes tax optimisation easier, particularly the balance between direct and indirect amortisation.

Disadvantages of the fixed rate

1. Generally higher cost

The fixed rate includes a "security premium" compared to SARON. In March 2026, a median 5-year fixed rate at 1.35% costs approximately 0.45% more than a median SARON at 0.90%. On CHF 800,000, that represents CHF 3,600 per year.

2. Early termination penalties

If you wish to break the contract before maturity (property sale, refinancing, bank switch), penalties can be very high. The longer the remaining term and the larger the rate gap, the greater the penalty.

3. No benefit if rates fall

If rates fall after signing, you continue to pay the contractual rate. You do not benefit from the decrease, unlike a SARON borrower.

4. Risk of overpaying over time

Historically, fixed-rate borrowers have paid more on average than SARON/LIBOR borrowers. The "security premium" has a real cost over time. It is the price of peace of mind.

Which term should you choose?

Choosing the right term is an important strategic decision. Here are the key factors to consider:

Short term (2-3 years)

• Advantage: lowest rate, quick renewal to benefit from potential rate drops.
• Disadvantage: little security, frequent renewals (with the associated stress).
• Ideal profile: you anticipate a rate decrease or plan to sell in the short term.

Medium term (5-7 years)

• Advantage: good balance between cost and security. The most popular term in Switzerland.
• Disadvantage: neither the lowest rate nor the longest protection.
• Ideal profile: the majority of homeowners. You want security without paying too much.

Long term (10-15 years)

• Advantage: maximum security, no renewal for a long period.
• Disadvantage: higher rate, potentially very heavy exit penalties.
• Ideal profile: cautious profile, tight budget, no plans to sell, or conviction that rates will rise.

Is the fixed rate right for you?

The fixed rate is particularly suited if:

• Your budget is tight and you cannot absorb a rate increase.
• You value predictability and peace of mind.
• You believe rates will rise in the medium term.
• You do not intend to sell or refinance before maturity.
• You prefer simplicity over optimisation.

If you are hesitating between SARON and fixed rate, see our detailed comparison: SARON vs fixed rate, the decision guide.

Our tips for getting the best fixed rate

1. Compare widely: differences between lenders often exceed 0.50%. Do not settle for your usual bank.
2. Optimise your loan-to-value ratio: the higher your equity (low LTV), the better your rate.
3. Polish your application: stable income, no debts, good savings -- all factors that reduce the bank's margin.
4. Negotiate: with competing offers in hand, systematically ask for an improvement.
5. Consider a forward rate: if your maturity is in 6-18 months and current rates are attractive, lock in a forward rate.
6. Use a broker: a mortgage broker has access to preferential rates and negotiates for you, free of charge.