The Israeli Property Market – How to Get a Mortgage
There are many options available for English speakers looking for mortgages from Israeli banks. Depending on your circumstances, different types of mortgage may be most suitable to you. Factors such as the currency of your income, where you reside, citizenship and economic standing are important to consider.
Mortgages in Israel tend to be variable and are often linked to the rate of inflation. Some banks do, however, offer fixed rate loans, although rarely for over 20 years. In Israeli is is advisable to get approved for a mortgage before signing a purchase contract for your new property.
It is important to note that Israeli banks do not offer the 80-95% mortgages sometimes available in the United States and Europe, and typically the maximum mortgage is to 75% of the property’s value.
As with most countries, the primary criteria for approving mortgages in Israel is the borrower’s income. Although existing assets are relevant and taken into account with the decision, income is considered a far more important criteria. Applicants working locally will normally be required to provide pay slips, while those working abroad will typically need to provide tax returns.
Foreign Currency Mortgage
Getting a foreign currency mortgage is usually an option, especially in major currencies such as the Dollar, Euro, Pound Sterling or Swiss Franc. The interest rate is that used by LIBOR plus a fixed premium which is dependent on the specific provider. The repayment is in the currency that’s borrowed and can be for up to 30 years.
Dollar Linked Mortgage
Mortgages linked to the dollar are usually available for over 30 years. The currency is in shekels but relative to the dollar rate. This is suitable for someone whose income is in US Dollars.
Shekel mortgages can be obtained for up to 30 years and are usually linked to variable interest. There are a huge variety of financial products available from a range of Israeli banks.
We can now arrange for a English speaking mortgage advisor to contact you and go through a number of different options as well as answer any queries. If you’d like us to get in touch with you, please fill in the contact form.