Mortgage In Israel
The process of taking out a mortgage in Israel is slightly different compared to the process in USA or UK. Unfortunately some buyers take out a mortgage in Israel without conducting any significant research of all relevant information. As a result, some customers end up purchasing expensive mortgages and in some cases even very volatile mortgages in which the rates might change dramatically.
According to mortgage consultancy www.evensapir.co.il, the process of taking a mortgage in Israel contain 4 steps.
First 1 : Getting an initial approval from the bank, a mortgage pre-approval. You need to submit detailed application to the bank.
Step 2: Choosing the right mortgage: This is the most important part. Mortgage in Israel includes some unique options. Like fix or variable rates indexed to the inflation.
For buyers with income in Euros or US dollars there is a option to take part of the mortgage using these currencies.
Step 3 : After the best mortgage terms are selected, there is short window of time to complete the purchasing of the mortgage and sign the documents at the bank.
Buyers need to show the bank an official appraisal report, a sellers approval, and of course power of attorney from a notary.
Also, life insurance policy covering the amount of the mortgage is required. The insurance policy is required in order to get approval for a mortgage by the bank.
Step 4 : Finally you can schedule a meeting at the bank and sign your mortgage contract. Only after the mortgage contract has been signed and approved does the bank sign off on the final approval. In the end, the mortgage amount is finally transferred to the seller’s account.
From this moment the monthly mortgage payments begin. You can choose paying every 1/10/15 every month.
It is recommended to take the mortgage with an English-speaking mortgage broker in Israel. Especially for residents outside of Israel.