Several banks, one decision
Israeli mortgages come mainly from a few banks: Mizrahi-Tefahot, Leumi, Hapoalim, Discount, First International, Mercantile and Bank of Jerusalem. Each bank prices its own offer, and prices differ by bank and by borrower. The useful question is not which bank is best in general, but which one makes you the best offer for your profile today.
What the Bank of Israel data show
The Bank of Israel publishes average mortgage rates by bank. Converted into a margin against Prime, the August 2026 averages on the Prime track were:
- Leumi about −0.73, Hapoalim about −0.70, Mizrahi-Tefahot about −0.67, Discount about −0.65
- First International about −1.07, Mercantile about −0.54
- Bank of Jerusalem about +0.84
- Banking system average about −0.71
These are averages over all borrowers that month, not offers. The differences between the large banks are small; your own profile and the competition you create matter more.
What decides your price
- Loan-to-value: the smaller the loan against the property, the lower the bank's risk.
- Payment-to-income: Directive 329 forbids payments above 50% of disposable income, and above 40% the bank must hold more capital, so it usually refuses or charges more.
- Income stability and documentation, credit history and existing debts.
- Loan size, term and the whole mix: a bank may give a deeper discount on one track and earn more on another.
- Your relationship with the bank and the competing offers you bring.
Step by step: make the banks compete
- Get a principle approval (אישור עקרוני, a preliminary approval with proposed rates) from at least two or three banks.
- Compare offers track by track, with the same mix and the same terms: a single average rate hides the differences.
- Show the best offer to the other banks and ask them to improve it.
- Negotiate fees as well, such as the file-opening fee (עמלת פתיחת תיק), not only rates.
- Look at the total cost and at the payment under rate and inflation scenarios, not only at the first monthly payment.
Trading margin between tracks
Because banks price the whole mix, you can sometimes accept a slightly smaller Prime discount in exchange for a lower fixed rate, or the other way round. A lower rate on a fixed track you will keep for 20 years is usually worth more than the same cut on a Prime track you could refinance later without a capitalization fee. Check the trade with your own numbers in the simulator.
With or without an adviser
An independent mortgage adviser (יועץ משכנתאות) can run the tender for you; a bank's own adviser works for the bank. Either way, competition is what moves the price, and no adviser can guarantee a specific discount.