Mortgage Academy
Master the Israeli mortgage market. Learn about different loan tracks, understand regulations, and make informed decisions about your Tamhil (mix).
Table of Contents
SimulatorFeatured Articles
How a Mortgage Mix is Built
Maximum 66% Prime
No more than two-thirds of your mortgage can be in Prime-linked tracks.
Minimum 33% Fixed
At least one-third must be in fixed-rate tracks (Kalatz or Katz).
Maximum 75% LTV
For primary residence, you can borrow up to 75% of property value.
Maximum 40% PTI
Monthly payment cannot exceed 40% of your net income.
Conservative
Maximum stability, higher cost
Balanced
Mix of stability and flexibility
Aggressive
Lower initial payments, higher risk
Oleh Special
Maximizes Zakaut benefits
What is Madad?
Madad (מדד) is the Hebrew term for the Consumer Price Index (CPI). When a loan is "indexed to Madad," your loan principal is adjusted monthly based on changes in the CPI. If inflation is 3%, your remaining debt grows by 3%.
The Trade-off
CPI-indexed loans offer lower initial interest rates because the bank's inflation risk is transferred to you. In low-inflation periods, this saves money. In high-inflation periods (like 2022-2023), your payments can increase significantly.
Visual Example
Loan of ₪500,000 after 5 years:
* Simplified example. Actual impact depends on amortization schedule.
Recommendation: If you're risk-averse or on a fixed income, prefer non-indexed (Kalatz) tracks even if rates are higher.
Find Your Fit
How stable is your income?
Loan Track Types
Variable rate tied to the Bank of Israel prime rate
Volatility Risk
Inflation Risk
Advantages
- No early repayment penalty
- Benefits from rate decreases
- Currently offers competitive rates
Disadvantages
- Payment can increase significantly
- Hard to budget long-term
- Limited to 66% of total loan
⚖️ Regulatory Limit: Maximum 66% of mortgage
Fixed rate, non-indexed - your payment stays constant
Volatility Risk
Inflation Risk
Advantages
- Complete payment predictability
- Protected from rate increases
- Protected from inflation
Disadvantages
- Higher initial rate
- Early repayment penalty applies
- Cannot benefit from rate drops
Fixed rate, CPI-indexed - stable rate but principal adjusts with inflation
Volatility Risk
Inflation Risk
Advantages
- Lower initial rate than Kalatz
- Rate stays fixed
- Good when inflation is low
Disadvantages
- Principal grows with inflation
- Monthly payment can increase
- Early repayment penalty
Variable rate, CPI-indexed - double exposure to market changes
Volatility Risk
Inflation Risk
Advantages
- Lowest initial rates
- Good in deflationary periods
- Can be very cheap short-term
Disadvantages
- Double market exposure
- Both rate and principal can rise
- Very hard to predict payments
Government-subsidized loan for eligible buyers (Olim, first-time buyers)
Volatility Risk
Inflation Risk
Advantages
- Subsidized low rates
- Government backing
- Available to eligible groups
Disadvantages
- Limited eligibility
- CPI-indexed principal
- Amount limits apply
Variable rate, non-indexed, adjusts every 18 months based on government bonds
Volatility Risk
Inflation Risk
Advantages
- More stable than Prime
- Rate adjusts every 18 months
- Non-indexed principal
Disadvantages
- Rate can increase at adjustment
- Early repayment penalty
- Less predictable than fixed
Variable rate, non-indexed, adjusts every 3 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Rate locked for 3 years
- More stable than Prime
- Non-indexed principal
Disadvantages
- Rate can increase at adjustment
- Early repayment penalty
- Less predictable than fixed
Variable rate, CPI-indexed, adjusts every 3 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Lower initial rate
- Rate locked for 3 years
- More stable than Prime
Disadvantages
- Principal grows with inflation
- Rate can increase at adjustment
- Early repayment penalty
Variable rate, non-indexed, adjusts every 5 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Rate locked for 5 years
- Very stable payment periods
- Non-indexed principal
Disadvantages
- Rate can increase at adjustment
- Early repayment penalty
- Less predictable than fully fixed
Variable rate, CPI-indexed, adjusts every 5 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Lower initial rate
- Rate locked for 5 years
- More stable than Prime
Disadvantages
- Principal grows with inflation
- Rate can increase at adjustment
- Early repayment penalty
Variable rate, non-indexed, adjusts every 10 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Rate locked for 10 years
- Near-fixed predictability
- Non-indexed principal
Disadvantages
- Rate can increase at adjustment
- Early repayment penalty
- Very long commitment period
Variable rate, CPI-indexed, adjusts every 10 years based on government bonds
Volatility Risk
Inflation Risk
Advantages
- Rate locked for 10 years
- Lower initial rate
- Very stable rate periods
Disadvantages
- Principal grows with inflation
- Rate can increase at adjustment
- Early repayment penalty
Track Comparison Matrix
| Track Type | Volatility Risk | Inflation Risk | Fixed Rate | CPI Indexed | Adjustment Period | Exit Penalty | Max % | Trend |
|---|---|---|---|---|---|---|---|---|
📈 Prime פריים | High Risk | Low Risk | Continuous | 66% | — | |||
🔒 Kalatz קל"צ | Low Risk | Low Risk | N/A | 100% | — | |||
📊 Katz ק"צ | Low Risk | High Risk | N/A | 100% | — | |||
🎲 Matz מ"צ | High Risk | High Risk | 5 years | 100% | — | |||
🏛️ Zakaut זכאות | Low Risk | Medium Risk | N/A | 100% | — | |||
🔄 Bond 18M משתנה לא צמודה כל 18 חודשים | Medium Risk | Low Risk | 18 months | 100% | — | |||
⏱️ Bond 3Y משתנה לא צמודה כל 3 שנים | Medium Risk | Low Risk | 3 years | 100% | — | |||
📉 Bond 3Y Indexed משתנה צמודה כל 3 שנים | Medium Risk | High Risk | 3 years | 100% | — | |||
📅 Bond 5Y משתנה לא צמודה כל 5 שנים | Low Risk | Low Risk | 5 years | 100% | — | |||
📊 Bond 5Y Indexed משתנה צמודה כל 5 שנים | Medium Risk | High Risk | 5 years | 100% | — | |||
🗓️ Bond 10Y משתנה לא צמודה כל 10 שנים | Low Risk | Low Risk | 10 years | 100% | — | |||
📈 Bond 10Y Indexed משתנה צמודה כל 10 שנים | Low Risk | High Risk | 10 years | 100% | — |
Rate Trends Over Time
Glossary
Visual Examples
Click on terms to see detailed explanations and examples.
Frequently Asked Questions
What is a mortgage mix (Tamhil)?
A mortgage mix is a combination of different mortgage tracks (Prime, Kalatz, Katz, etc.) that together make up your total loan according to Bank of Israel regulations.
What is the maximum Prime percentage allowed?
Bank of Israel regulations limit Prime-based mortgages to a maximum of 66% of the total loan amount.
What is the minimum fixed rate percentage required?
At least 33% of your mortgage must be in fixed-rate tracks (Kalatz or Katz) according to Bank of Israel regulations.