Practical tip - Housing - Rental Safety Deposit
Updated: Dec 28, 2022
Safety deposit for your apartment rental
You have just signed up for your apartment lease contract?
There are 4 tasks to complete before the key handover:
1) Rental contract duly signed
2) Safety deposit
3) Proof of first month payment
4) Liability insurance
The crucial task is the Safety deposit, in French “garantie de loyer”. The amount usually corresponds to 3 months’ rent, as per rental contract. It is not a usual bank transfer but a special and separate blocked account. At the end of your lease, if all rents and utilities have been paid, apartment given back in order, normal ware and tare accepted, you will be refunded the entire amount. Most banks charge a one-time fee of CHF 100.
The option with the bank account takes approximately 10 working days to complete, to be completed online!
Alternatively, often chosen because of time constraints, you can issue a contract with an “insurance company” such as Swisscaution, Firstcaution or others, which are insurance companies specialized in rental deposits. They charge an annual interest fee or prorate annual fee as per lease start date.
You can also start with an “insurance company” and once settled, cancel the subscription as per indicated notice period and open for bank deposit. We have many clients choosing this option, this giving them some air on their cashflow.
Transfer your FirstCaution/Swisscaution/SmartCaution account into a blocked bank account.
Example with UBS bank account. The procedure with Credit Suisse, Migros Bank and BCV is similar.
1) Clarify cancellation conditions and terms with the Caution company.
2) Download the form for a UBS surety account, once the IBAN provided, pay the amount mentioned on the lease.
3) Follow up with your banker if necessary.
4) The one-time fee of CHF 100 will be charged separately.
5) The UBS surety account is only complete once you receive the confirmation, a copy is sent to the real estate.
6) Provide UBS confirmation to Firstcaution and make sure your contract is duly cancelled.