Mortgages for non-residents: getting a loan without living in Israel
Yes, Israeli banks lend to buyers who live abroad. With a bigger down payment, a thicker file and longer timelines than a resident, but with no nationality or religion requirement. Here is exactly how it works, and what changes if you are an Israeli citizen or in the middle of aliyah.
The short answer
A non-resident generally obtains up to 50% of the price from an Israeli bank, over up to 30 years, on the same tracks as residents (prime, fixed, CPI-linked) with a slightly higher margin. An Israeli citizen living abroad or a buyer who plans aliyah within two years can obtain 70 to 75%. You need an Israeli bank account, translated proof of income, life insurance, and 4 to 8 weeks.
The figures to remember, November 2026
- Non-resident loan-to-value
- 50%
- Citizen or aliyah within 2 years
- 70–75%
- Prime rate
- 4.75%
- Maximum term
- 30 years
- Minimum fixed share
- ⅓
- Usual timeline
- 4–8 weeks
How much a bank lends to a non-resident
The Bank of Israel sets loan-to-value caps by type of resident buyer: 75% for a first home, 70% for a buyer replacing their home, 50% for an investor. The non-resident is not named in the directive: banks, out of caution, treat them as an investor, hence the practical cap of 50%. It is not a legal rule, it is a risk policy, and it can be discussed.
The amount lent is calculated on the lower of two values: the contract price and the bank’s appraisal (by a shamai, a licensed appraiser). On a new property bought off-plan, the appraisal uses the value at completion, which is usually favourable.
The bank then checks your repayment capacity: the monthly payment must not exceed 35 to 40% of the household’s net income (50% is the regulatory maximum, rarely granted). Your foreign income is converted into shekels, often with a 10 to 20% haircut for currency risk. A buyer with net income of $6,000 a month (≈ ₪21,600 at 3.6) will be "read" at around ₪18,000 to ₪19,500 rather than ₪21,600.
Non-resident, Israeli citizen abroad, future oleh: three different treatments
Foreign non-resident
≈ 50%- No nationality required.
- Treated as an investor by the banks.
- Margin on prime often 0.2 to 0.4 of a point higher.
- Purchase tax at 8% from the first shekel.
Israeli citizen living abroad
up to 75%- Treated as a resident if it is their only home in Israel.
- Foreign income accepted, same haircut.
- Banks like to see an existing account history in Israel.
Aliyah planned within two years
up to 75%- On presentation of the aliyah file (Jewish Agency or Nefesh B’Nefesh, Ministry of Aliyah and Integration).
- Some banks require aliyah to be effective before funding.
- Also opens the oleh schedule for purchase tax.
In the last two cases the gain is double: a smaller down payment and, for the oleh, a near-zero purchase tax instead of 8%. On a ₪2.5M property, that is ₪625,000 less in down payment and up to ₪197,000 less in tax, together about $230,000. If aliyah is a serious option, it is decided before the contract is signed, not after. The exact conditions offered to new immigrants are detailed in mortgage for new olim.
The documents you need
A non-resident’s file is thicker than a resident’s, because the bank cannot verify anything itself. Prepare it before you even start looking at properties: it is what makes the difference between four and eight weeks.
| Document | Detail | Translation |
|---|---|---|
| Passport | Certified copy; Israeli ID card (teudat zehut) if you have one | No |
| Proof of income | Employees: last 3 pay stubs, last 2 years of tax returns (1040 / SA100 / T1) or W-2 / P60, employer letter. Self-employed: financial statements and tax returns for the last 2 or 3 years, CPA or accountant letter | English is accepted by all major banks; Hebrew sometimes requested for non-English documents |
| Bank statements | Last 3 to 6 months of every account, to prove the source of the down payment (anti-money-laundering) | English accepted |
| Proof of down payment | Savings, sale of a property, gift (with a gift letter or deed), family loan (with a contract) | English accepted |
| Existing loans | Amortisation schedules of your mortgages and loans abroad; credit report (Experian, Equifax) helps | English |
| The property | Contract or draft contract, Tabu extract (nesach Tabu); for a new build, the developer’s contract and the bank guarantee | Hebrew (supplied by the lawyer) |
| Bank forms | Loan application, tax residency declaration (FATCA W-9 for US persons, CRS for everyone else), consent to a credit check | — |
| Insurance | Medical questionnaire for life insurance; proof of building insurance before funding | — |
Israeli banks apply anti-money-laundering rules strictly: every wire for the down payment must be traced back to its source. A down payment that has passed through several accounts, or that comes from a third party without paperwork, stalls the file for weeks. Prepare the chain of documents before the first wire. US persons should expect the bank to ask for a W-9 and to report the account under FATCA; the account itself goes on your FBAR once balances exceed $10,000.
Which banks lend to non-residents
All five major banks lend to non-residents, with appetites that vary from one period to the next. In practice:
- Mizrahi-Tefahot: the country’s largest mortgage lender, the most experienced with olim and non-resident files, English-speaking branches in Jerusalem, Raanana, Modiin, Beit Shemesh and Netanya.
- Bank Leumi and Bank Hapoalim: welcome non-resident files from clients who already hold an account with them; international departments in Tel Aviv and Jerusalem.
- Discount: an international private banking unit dedicated to non-residents, geared to loans from ₪1M upwards.
- Bank of Jerusalem: historically specialised in lending to non-residents, with well-established remote signing procedures; margins a little higher.
- Non-bank lenders (licensed credit companies): up to 80-85% financing on top of a bank, at markedly higher rates; for cases where the down payment is temporarily short.
No bank publishes a rate sheet for non-residents: margins are negotiated file by file, and that is exactly where a broker who files non-resident applications every month makes the difference.
Steps and timelines
- Pre-approval (ishur ekroni), before you search. With your proof of income and down payment, the bank states the amount it is willing to lend. Usually valid for 24 days, renewable. It is free and it keeps you from negotiating a property you cannot finance. Timeline: 2 to 10 days.
- Opening an Israeli bank account. Mandatory, since the monthly payments are debited from it. Possible remotely at most banks, by power of attorney to your lawyer or by video call, but simpler during a trip to Israel. Timeline: 1 to 3 weeks.
- Signing the sale contract. Your lawyer inserts a financing clause and a payment schedule compatible with the bank’s funding.
- Appraisal. The bank appoints an appraiser (shamai) at your expense, ₪600 to ₪1,500. Timeline: 1 week.
- Final offer and signing of the loan documents. If you are not in Israel: signature before a local notary followed by an apostille, or at the Israeli consulate, or by a specific power of attorney given to your lawyer (the bank must accept it). Life and building insurance taken out. Timeline: 1 to 3 weeks.
- Funding. The money goes straight to the seller (or to the developer according to the schedule), never to your account. The bank registers a mortgage or a caution note (hearat azhara) at the Tabu.
Rates and tracks for a non-resident
The tracks are the same as for a resident: prime (variable, follows the Bank of Israel), fixed unlinked, fixed CPI-linked (madad), variable every five years. The one-third-fixed rule applies the same way. What changes is the margin: expect 0.2 to 0.4 of a point more than a resident on prime and fixed, because the bank cannot garnish your income abroad.
| Track | Resident, strong file | Non-resident |
|---|---|---|
| Prime | P − 0.7 to − 0.9% | P − 0.3 to − 0.6% |
| Fixed unlinked, 25 years | 4.8 to 5.1% | 5.0 to 5.5% |
| Fixed CPI-linked, 25 years | 2.6 to 3.0% + CPI | 2.9 to 3.3% + CPI |
One piece of advice specific to non-residents: if your income is in dollars or pounds, favour the fixed unlinked share. You already carry currency risk on the monthly payment; there is no point adding rate risk and inflation risk on top of it.
Split between tracks
Prime (variable)
Fixed, unlinked
Fixed, CPI-linked
Bank of Israel rules: at least one third of the loan at a fixed rate, at most two thirds on prime. The simulator adjusts the sliders accordingly.
- Principal repaid—
- Interest—
- Prime (variable) · Fixed, unlinked · Fixed, CPI-linked—
Indicative rates, November 2026 (policy rate 3.25%, prime 4.75%). The CPI-linked track is simulated with constant inflation; in reality both the payment and the outstanding balance move with the CPI. Banks apply different margins by profile and city: a real offer can differ by ±0.5 point.
Worked example: family living in New Jersey, apartment in Netanya
| Down payment (50%) | ₪1,400,000 (≈ $390,000) |
| Purchase tax (8%) | ₪224,000 |
| Lawyer (≈ 0.75% + VAT), agent (2% + VAT), broker, appraisal, bank fees | ≈ ₪115,000 |
| Cash required | ≈ ₪1,740,000 (≈ $483,000) |
| Loan of ₪1,400,000, mix 35% prime / 40% fixed / 25% CPI-linked | ≈ ₪7,900 / month (≈ $2,190) |
| Income as read by the bank (≈ ₪28,000 converted, 15% haircut) | ≈ ₪23,800 |
| Payment-to-income | 33%: the file is financeable |
The same family, if one spouse holds Israeli citizenship and it is their only home in Israel, could obtain 70% financing: the down payment drops to ₪840,000, but the payment rises to about ₪11,000 and the payment-to-income ratio to 46%, which the bank will refuse. In that specific case, the right dose is around 60% financing. The deposit calculation for each status, costs included, is summed up in how much deposit do I need, and the 8% tax in purchase tax in Israel for foreigners.
The pitfalls specific to non-residents
- Signing the contract before the pre-approval. The seller will not wait for you; the contract carries late-payment penalties. Get the ishur ekroni first.
- Underestimating currency moves. Between pre-approval and funding, the dollar or the pound can move 3 to 5% against the shekel. On a $390,000 down payment, that is $12,000 to $20,000 either way. Currency brokers let you lock a forward rate.
- A poorly documented down payment. See above: every wire must have a legible story.
- Life insurance declined. Past 60 or with a medical history, some insurers decline or load the premium. Fill in the medical questionnaire at the same time as the loan application, not after.
- Forgetting the tax rules back home. A US person reports the Israeli bank account on the FBAR and under FATCA, and declares future rental income on the 1040 with a foreign tax credit under the US–Israel tax treaty. A UK resident declares the rent on the foreign pages of the self-assessment. The bank will not tell you this.
- Prepaying a fixed track. If rates have fallen, the penalty (amlat piraon mukdam) can reach several percent of the principal. Prime, on the other hand, can be repaid at no cost. There is no "no-penalty after year 3" rule as in some US loans.
The alternatives to an Israeli mortgage
Borrowing in your home country against an existing property: a home equity line of credit (HELOC) or cash-out refinance in the US, a remortgage or further advance in the UK, a HELOC in Canada. Rates often below Israel’s, shorter terms, no Israeli paperwork. Downside: you pay in dollars or pounds a debt tied to an asset in shekels, and you tie up your existing home.
Developer financing on new builds: some developers accept a 20 / 80 schedule (20% at signing, 80% at delivery), which leaves you two or three years to arrange the loan or organise aliyah. Indexation of the balance to the construction cost index (madad tshumot habniya) during the build is the price of that flexibility (details in buying off-plan from a developer). American and British buyers also have dedicated pages: buying from the USA and buying from the UK.
Combining: down payment partly financed at home, Israeli mortgage at 50%, developer financing on a new build. It is the most common structure among Anglo buyers, and the one that negotiates best with a broker on each side.
Frequently asked questions
Do I need to be Jewish or Israeli to get a mortgage?
No. No bank requires Israeli citizenship or any connection to Israel. What counts is creditworthiness, the down payment and the quality of the property. Citizenship and aliyah only change the maximum loan-to-value.
Is income in dollars, pounds or Canadian dollars accepted?
Yes, that is the normal case for a non-resident. The bank converts your income into shekels at a conservative rate and may apply a 10 to 20% haircut for currency risk. Some banks offer loans denominated in dollars, to be examined case by case.
How long does a non-resident file take?
Allow 4 to 8 weeks between filing and funding, against 2 to 4 weeks for a resident. The delays come mostly from signatures abroad, translations and anti-money-laundering checks on the down payment.
Can I borrow in the US or UK instead?
American and British lenders do not take a mortgage on a property in Israel. You can, however, draw on an existing home (home equity line of credit or cash-out refinance in the US, a remortgage or further advance in the UK) or take a personal loan, often at a lower rate than in Israel but over a shorter term. Many buyers combine both.
What happens if I make aliyah after borrowing?
Nothing changes in the contract. You can, however, refinance (michzur) to move to a resident’s loan-to-value and terms, and you benefit from the oleh purchase tax schedule if you buy in the year before or the seven years after aliyah.
What insurance does the bank require?
Two policies: life insurance (bituach hayim) covering the outstanding principal, and building insurance (bituach mivneh). For a non-resident, life cover is sometimes harder to obtain past 60 or with a medical history: start it early.
How we work
Every amount, bracket and rate on this page is checked against the official source listed at the bottom and dated. When a schedule or rate changes, the page is updated within days. Our methodology.
Sources
Get a pre-approval from abroad
An English-speaking mortgage broker who handles non-resident files every week shops several banks and gets you a pre-approval in 48 to 72 hours. Describe your project in two lines.