… and if the bank cannot confirm the purchase price?
The high prices of the real estate precede the hedonic valuation systems. In many cases, properties are sold in a bidding process and this additionally drives up the prices. Whoever pays the most gets the property. But even if no bidding process is used, there are buyers who simply pay much more than the market value. That’s the only way they can get their hands on the property.
If you don’t bring enough equity to the table, it’s going to be difficult.
What happens if the financing institution does not accept the purchase price and bases the financing on a much lower value?
Basically, the difference between the purchase price and the market value of the financing institution must be financed with your own funds.
Purchase price CHF 1’500’000
Accepted value CHF 1’300’000
The difference of CHF 200’000 must be financed with own funds.
In addition, at least 20% of own funds must be provided on the basis of the market value.
So again CHF 260’000.
Total therefore CHF 460’000 own funds
If the bank accepts CHF 1’500’000 as the market value, then at least 20 % own funds must be provided.
The total amount of own funds is therefore CHF 300,000.
The financial institutions plausibilize the purchase prices of properties with different hedonic valuation systems. There are for example Fahrländer, Wüest Dimensions or IAZI. If you do not get to the purchase price with these methods, there are various options that can still be exploited. Some still have a bandwidth available or a specialist loop, others can still do a manual valuation in their own competence, etc. The procedures within the financial institutions are very diverse.
Now it is important that you know an independent mortgage consultant who knows exactly at which institution and in which area the purchase prices are most likely to be plausible.
We are happy to advise you. Come to us and benefit from our experience.