Israel Mortgage Guide for Foreign Buyers

Everything you need to know about getting a Mashkanta — even as a non-resident

The Israeli Mortgage (Mashkanta) System

Israel's mortgage system is well-developed and accessible to foreign buyers. Non-residents can typically borrow up to 50% of the property value (LTV), compared to 75% for Israeli residents on their first home. Interest rates are competitive, and multiple loan track options allow customization.

Major banks offering mortgages to non-residents: Bank Leumi, Bank Hapoalim, Mizrahi Tefahot, Discount Bank, and Bank Yahav. Each has a mortgage department (Mashkanatot) with English-speaking advisors. Some banks have specialized international divisions.

Mortgage Tracks Explained

Israeli mortgages combine multiple tracks (channels) in one loan. Common tracks: Fixed CPI-linked (Tzamud Kavua): Fixed rate linked to inflation index. Stable and predictable. Variable CPI-linked (Tzamud Mishtana): Rate adjusts every 5 years. Lower initial rate. Fixed Shekel (Shekel Kavua Lo Tzamud): Fixed rate, not inflation-linked. Full certainty. Variable Shekel (Prime): Linked to Bank of Israel prime rate. Lowest initial rate but most volatile.

Bank of Israel regulations require diversification across at least 2 tracks. Maximum term: 30 years. Most borrowers take 15-25 year mortgages. Monthly payments cannot exceed 40% of documented income.

Requirements for Non-Residents

Documentation needed: passport, proof of income (last 3 years tax returns or pay stubs), bank statements (6-12 months), employment verification, and credit report from home country. The bank will also appraise the property. Processing time: 2-6 weeks from application to approval. We work with mortgage brokers who specialize in non-resident applications and can navigate the process efficiently.

Pros

Available to non-residents, Multiple track options, Competitive rates, English-speaking advisors available, Tax-deductible interest on rentals

Cons

50% LTV maximum for non-residents, Extensive documentation, CPI-linkage adds inflation risk, Process can be slow, Exchange rate risk

Frequently asked questions

What's the maximum mortgage a non-resident can get?

Non-residents can borrow up to 50% of the property value (LTV). For investment properties, this applies to both residents and non-residents. First-time resident buyers can borrow up to 75%. The minimum down payment is therefore 50% for foreign buyers.

What interest rates can I expect?

Rates vary by track and market conditions. As of recent data: Fixed CPI-linked: 2.5-4%, Variable CPI-linked: 2-3.5%, Fixed Shekel: 4-6%, Prime-linked: Prime +/- 0.5% (Prime is typically 4-6%). A good mortgage broker can negotiate significantly better terms.

Can I get a mortgage in a foreign currency?

Foreign currency mortgages are no longer standard in Israel. Most mortgages are in Israeli Shekels (NIS). However, your income documentation can be in foreign currency, and banks will convert based on exchange rates. Some banks offer dollar-denominated sub-tracks for specific situations.

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