Mortgage Modification Agreement for Switzerland

Mortgage Modification Agreement Template for Switzerland

This document is a legally binding agreement under Swiss law that modifies the terms of an existing mortgage agreement between a lender and borrower. It must comply with Swiss federal regulations, including the Swiss Civil Code (ZGB) and Code of Obligations (OR), as well as specific cantonal requirements for property transactions. The agreement details modifications to existing mortgage terms such as interest rates, payment schedules, or loan duration while maintaining the validity of the original mortgage security. It requires proper notarization and registration in accordance with Swiss property law requirements.

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What is a Mortgage Modification Agreement?

The Mortgage Modification Agreement is utilized when parties to an existing Swiss mortgage wish to alter specific terms without creating an entirely new mortgage agreement. This document becomes necessary in various situations, such as when borrowers face financial challenges requiring payment restructuring, when market conditions prompt interest rate adjustments, or when other material terms of the original mortgage need modification. The agreement must conform to Swiss legal requirements, including those set forth by FINMA and cantonal authorities. It typically includes detailed information about the original mortgage, specific modifications being made, and any new terms or conditions. The document requires careful drafting to ensure it maintains the security interest of the original mortgage while implementing the desired changes, and usually requires notarization to be legally effective in Switzerland.

What sections should be included in a Mortgage Modification Agreement?

1. Parties: Identification of the lender (typically a Swiss bank or financial institution) and the borrower(s), including full legal names, addresses, and any registration numbers for legal entities

2. Background: Details of the original mortgage agreement, including date, property details, and reasons for modification

3. Definitions: Key terms used in the agreement, including references to the original mortgage terms that remain unchanged

4. Original Mortgage Reference: Specific details of the original mortgage including registration details, property description, and current outstanding amount

5. Modifications: Clear statement of all terms being modified, such as interest rate changes, payment terms, or loan duration

6. Effective Date: Specification of when the modifications take effect

7. Continuing Validity: Confirmation that all unmodified terms of the original mortgage remain in full force and effect

8. Representations and Warranties: Borrower's confirmation of continued accuracy of original representations and any new representations

9. Costs and Fees: Allocation of costs related to the modification, including any notarial or registration fees

10. Governing Law and Jurisdiction: Confirmation of Swiss law application and competent courts

11. Execution: Signature blocks complying with Swiss formal requirements, including notarization provisions

What sections are optional to include in a Mortgage Modification Agreement?

1. Additional Security: Used when modification requires additional collateral or guarantees

2. Insurance Requirements: Include when modifying insurance obligations or requirements

3. Payment Schedule Modifications: Detailed section needed when payment terms are significantly restructured

4. Property Valuation: Required when modification is based on or requires new property valuation

5. Tax Provisions: Include when modification has specific tax implications requiring address

6. Default Provisions: Used when modifying or adding specific default triggers

7. Prepayment Terms: Include when modifying prepayment rights or penalties

8. Force Majeure: Added when including specific provisions for extraordinary circumstances

What schedules should be included in a Mortgage Modification Agreement?

1. Schedule A - Modified Payment Terms: Detailed breakdown of new payment schedule, amounts, and dates

2. Schedule B - Property Description: Detailed legal description of the mortgaged property including land register details

3. Schedule C - Outstanding Balance Statement: Current loan balance and payment history

4. Schedule D - Modified Interest Calculations: Details of any changes to interest calculation methods

5. Appendix 1 - Property Valuation Report: If applicable, current property valuation details

6. Appendix 2 - Insurance Certificates: Updated insurance documentation if required

7. Appendix 3 - Power of Attorney: If applicable, authorization documents for signing parties

8. Appendix 4 - Tax Certificates: Required tax clearances or certificates if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Switzerland

Publisher

Genie AI

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions
Relevant Industries

Banking

Real Estate

Financial Services

Legal Services

Property Development

Construction

Investment Management

Insurance

Professional Services

Public Administration

Relevant Teams

Legal

Compliance

Real Estate

Credit Risk

Mortgage Operations

Client Relations

Contract Management

Property Services

Financial Advisory

Documentation

Relevant Roles

Mortgage Advisor

Legal Counsel

Real Estate Manager

Credit Officer

Compliance Officer

Risk Manager

Property Manager

Banking Executive

Loan Officer

Contract Administrator

Real Estate Attorney

Portfolio Manager

Financial Advisor

Operations Manager

Relationship Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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