The different mortgage models at a glance
Fixed-rate mortgage
This form of mortgage is characterized by a fixed interest rate that remains unchanged over the entire term. This offers security and predictability, but is not flexible enough to benefit from possible interest rate reductions.
SARON mortgage
The Saron (Swiss Average Rate Overnight) has replaced the Libor since the end of 2021 and is linked to the short-term money market. The interest rate is adjusted at fixed intervals (usually 3 or 6 months) and consists of the current Saron overnight rate plus an individual margin for the bank. This mortgage is transparent and offers flexibility, but carries the risk of rising interest rates.
Variable rate mortgage
This mortgage is characterized by a flexible interest rate structure, without a fixed term and with shorter notice periods. As the interest rate is set individually by the banks and is less transparent, this form is often more expensive than fixed-rate mortgages or Saron mortgages.
Libor mortgage (historical)
Until the end of 2021, the Libor rate was a common basis for mortgages. After it was abolished, it was replaced by the Saron, which is also influenced by the SNB.
