Re-Cycling Money from Mortgage to re-invest

Hello,

I would like to build up a property portfolio and do the following:

- buy property and get a mortgage for 6-12 months (I buy property at max 70-80% of value, plus refurbish, so it is of much higher value then when I buy). let's put a price on it and say the property is from 1970, worth 550K before re-furb. I buy for 440K and refurb

- re-finance the mortgage after 6 months. I would like the bank who re-finances to re-evaluate the property (now after refurb worth 650K) and get a mortgage for 80% of the 650K.

With the new mortgage I will be able to invest into other properties.

It seems like banks and brokers in Switzerland don't know too much about this method.

a) is it possible to get a re-evaluation after 6 months / after re-furb

b) how to go about?

Thank you for any tips.

Hi there,

Swiss mortgage lenders do allow for mortgage increases. In German this practice is normally referred to as "Hypothek aufstocken."

You can apply for a mortgage increase when your current mortgage agreement expires. You can apply for a new mortgage with your existing mortgage provider or you can apply to refinance with a different lender. Even if you apply for the higher mortgage with your existing lender, the mortgage will be treated as a new application because the requested loan has changed. The property will be reevaluated and the possible mortgage will be readjusted to match your new loan-to-value ratio in keeping with affordability requirements.

Best regards from Moneyguru