Mortgage ranking

Classification of the mortgage as first or second rank based on LTV.

Mortgage ranking refers to the repayment priority of a mortgage loan in the event of forced sale of the property. In Switzerland, the main distinction is between first rank and second rank.

The first rank covers financing up to 67% of the property value. It is generally not subject to mandatory amortisation, as the risk for the bank is considered low.

The second rank covers the tranche between 67% and 80% of the property value. It must be amortised within a maximum of 15 years or before retirement age. In the event of a forced sale, the first-rank creditor is repaid first.

Some banks offer different rates depending on the rank, with the second rank sometimes being slightly more expensive due to the increased risk.

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