Mortgages in Israel

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Israeli and non-Israeli citizens are able to obtain mortgages from commercial banks in Israel. Beyond commercial loans, Israel, Israel offers two types of mortgages, both backed by the government. One of them — mashkanta — is available to citizens who didn't own residential property as of 1 June 1972. The other type — the so-called local subsidy — is available to both Israelis and foreign citizens who wish to purchase property in certain areas that are generally not industrially developed and lack mature infrastructure.

Maximum LTV ratio	50% (for residents: 75%)
Minimum and maximum loan amounts	—
Fixed rates	3-3.5% p.a.
Loan term	Up to 30 years
Minimum age of borrower	18
Maximum age of borrower by the end of the loan term	Not defined (depends on the terms of each bank)
Maximum percentage of monthly income for mortgage	33%

Documents

Prospective borrowers need to submit the following documents to Israeli banks:

passport
guarantors' passports (if needed)
tax returns for the two previous years proving annual income
extract from the Land Register (issued no less than six weeks in advance)
property documents.

All the papers must be drawn up in Hebrew or English and notarised.

Loan applications usually take 1-2 weeks for approval.

Additional costs

Additional mortgage costs in Israel typically don’t exceed 1,000 Israeli New Shekels (ILS*) ($300).

Property appraisal and Due Diligence	About 600 shekels
Borrower's life and property insurance	Several hundred shekels (depends on individual terms)
Mortgage arrangement fee	Several dozen shekels

*1ILS=0.26 USD (as of early December 2016)

Property buying guide for Israel

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