Notice period for fixed rate mortgages

Is there such a thing as a notice period for fixed rate mortgages? How would this work seeing that the interest rates and term are fixed?

Hi there,

When you get a fixed rate mortgage (FRM), the interest rate is fixed for a predefined period of time. FRM terms are typically 5, 10 or 15 years.

But although rates and terms are fixed, many banks require you to give notice in order to terminate your mortgage when it reaches the end of its term. If you do not give sufficient notice, your mortgage automatically becomes an variable rate mortgage at the end of the fixed term.

Interest rates for Swiss variable rate mortgages are notoriously high, so terminating your FRM on time and refinancing with another FRM or LIBOR-based mortgage is recommended.

Review your mortgage agreement carefully. If it specifies a notice period, make sure to give sufficient notice if you want to terminate your mortgage at the end of the fixed term. Notice periods are typically 3 months or 6 months ahead of the end of the FRM term.

Best regards from Moneyguru

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