As home ownership is regarded as a type of pension provision, each insured person may use his/her pension assets to purchase real estate or to repay a mortgage.
The insured person may benefit from this measure in one of two ways: early payment and a pledge. It should be noted that the financed property must be his/her principal place of residence.
Advance payment
This is a lump sum payment, which will result in a reduction in the retirement benefits and, possibly, disability and death benefits if the insured member does not make subsequent reimbursements. The minimum amount of an advance payment is CHF 20,000. The application must be submitted in writing to the Patrimonia Foundation and the spouse must give his/her consent in writing.
Pledge
This involves pledging to a creditor the entitlement to all future occupational benefits or an amount that does not exceed the vested benefit. The pledge does not reduce the retirement, disability and death benefits and enables you to increase the amount that you are entitled to lend in order to finance your home. The pledge also provides a tax benefit as the pledged amount is not taxable. Moreover, as the amount pledged is classed as foreign funds, it is possible to deduct the highest mortgage interest from the taxable income.
A form and an explanatory note are provided to enable you to initiate this procedure.
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