How should you amortise a mortgage loan?

Thanks to its many years of experience in a field that requires extensive expertise, BCGE has become one of the main regional providers of real estate loans. It finances properties in Switzerland and in France, acting with complete independence and speed, in line with its real estate financing guidelines.

A mortgage loan from BCGE is part of a comprehensive advisory service that also takes into account the impact on your assets, taxes and pension provision. The question of amortisation or repayment of the loan plays a central role in this approach. The decision depends on the borrower's personal situation and objectives.

As a rule, the mortgage loan cannot exceed 80% of the collateral value of the property. This 80% is made up of a 1st rank of 66.6% and a 2nd rank of 13.4%. The 2nd rank must be amortised within a maximum of 15 years.

The loan can be amortised directly. In this case, both the amount owed and the corresponding interest payments decrease over time, all other things being equal. However, with a decreasing mortgage loan and decreasing interest costs, fewer tax deductions can be made.

You can also opt for indirect amortisation. The payments are credited to a Pillar 3A account instead of being used to repay the mortgage loan. The pension capital is paid out at the latest at the time of retirement and offset against the existing mortgage.

“Indirect amortisation allows homeowners to pay into the 3rd pillar and thus save taxes.”

Advantages of indirect amortisation

  • Double tax deduction: on the one hand, with the stable mortgage loan and on the other hand, with payments into the 3rd pillar.
  • The capital paid into the 3rd pillar is not included in your taxable assets.
  • It is possible to achieve a higher return on the capital repaid with the BCGE pension fund savings plan.


Whether direct or indirect amortisation is the right decision depends on numerous factors: financial situation, age, type of mortgage loan, liquidity requirements, location and use of the property (primary or secondary residence), etc. It is therefore essential to be accompanied by an expert in order to determine an optimal strategy for today and tomorrow.