ZOOM ON... The mortgage schedule

In Switzerland, the mortgage note is the most common guarantee for the financing of a property.

Definition

According to article 842 of the Swiss Civil Code, a mortgage note is a personal claim secured by a pledge on real estate.

Role of the mortgage schedule

As a non-possessory security, the mortgage note assures the creditor or lender that the borrower or debtor will repay the entire amount of the loan (principal & interest).

If not, the creditor may be reimbursed from the proceeds of the auction of the property listed in the schedule.

The form of the mortgage note

It can be registered or bearer. It can be on paper or in a register.

When it is on paper, it is established by a notary and registered in the land register on the sheet of the pledged property. As such, it constitutes a real estate value that indicates the amount that the creditor can claim from the debtor as well as the real estate that provides the guarantee.

It remains in the possession of the creditor or the notary until it is repaid in full by the debtor.

As soon as the loan is repaid, the title returns to the debtor.

In such a case, the latter is free to use the same title to contract new loans, for amounts up to the sum indicated on the schedule.

Justin KOTTIN - Legal Officer at Raizers