Pension PlanResidential Property
Under the home ownership promotion program (WEF), you can use the Pension Fund’s pension capital to finance your owner-occupied home. You have the two options of advance withdrawal or pledging pension assets.
In the case of an advance withdrawal all or part of your retirement assets are paid out in cash. Pledging means that your money remains in the Pension Fund, but your pension benefits are pledged to the creditor as collateral. You should carefully weigh up the advantages and disadvantages – and don't forget to take the tax implications into account.
Pension Fund assets can only be used as an advance withdrawal or pledge for your own use. You must personally use the property as your place of residence or as your usual or regular domicile (in Switzerland or abroad). Renting out the property is generally not permitted. If the use of the residential property is temporarily not possible, for example due to a short-term, job- or health-related change of location, renting out the property may be possible after consultation with the Pension Fund.
In the following you can see what kinds of things qualify or do not qualify for WEF advance withdrawal or pledging of pension assets.
- Acquisition and construction of residential property. This includes:
- Sole ownership
- Joint ownership (condominium)
- Ownership in common (with spouse)
- Separate and perpetual ground lease
- Making value-enhancing investments in residential property
- Making mortgage repayments
- Acquisition of participation certificates in cooperative housing associations or similar forms of participation
- Vacation home
- Second home
- Purchasing building land
- Chattel buildings (e.g. trailers, mobile homes, etc.)
- Funding standard maintenance work (repairs, etc.)
- Paying mortgage interest
- Paying the taxes incurred by advance withdrawal
- Paying reservation charges