How much can I borrow in Israel?
Your maximum is the lower of two limits: the loan the bank's rules let your income carry (first payment at most 50% of net income) and the loan your down payment allows (75% of the price for a first home, 70% replacement, 50% additional home or foreign resident).
Your down payment is what limits you: your income could carry a larger loan, but the loan-to-value limit for this purchase stops it, so more down payment raises your maximum.
Two rules from Bank of Israel Directive 329 decide how much you can borrow. The first is the loan-to-value limit: the loan cannot exceed 75% of the price for your only home, 70% for a replacement home, and 50% for an additional home or if you are a foreign resident. The second is the payment limit: your first monthly payment cannot exceed 50% of your net income, and above 40% banks hold more capital and price the loan higher.
The calculator works out both. From your down payment it finds the highest price the loan-to-value limit allows. From your income it finds the largest loan for which the site's optimizer can build a compliant mix: at least one third fixed rate, at most two thirds variable, over up to 30 years, at the current reference rates. Your maximum price is the lower of the two, and the result tells you which one is stopping you.
If you have a Zakaut certificate, enter the amount. It is a cheap, fixed-rate slice of the loan, so it raises what your income can carry. Leave it empty if you are not sure; you can estimate it in the Zakaut calculator.
Treat the result as an upper bound, not an approval. The bank also looks at your other loans and obligations, your credit record and the property itself, and the rates change. Purchase tax and fees come on top of your down payment, so keep a margin.
Questions
- What is the maximum mortgage as a percentage of the price?
- 75% for your only home, 70% for a replacement home (you sell the current one), and 50% for an additional home, an investment property or a foreign resident. These limits come from Bank of Israel Directive 329.
- How much of my income can go to the monthly payment?
- The first payment cannot exceed 50% of your net income. Above 40% banks consider the loan riskier and usually charge a higher margin, so staying under 40% is cheaper.
- Why is my maximum lower than 75% of the price?
- Because your income is the binding limit. The calculator shows which rule limits you. If it is income, a larger down payment will not raise your maximum price by much, but a longer term or a Zakaut loan will help.
- Does the result include purchase tax and fees?
- No. The down payment you enter is the money that goes into the price. Purchase tax, legal fees and the broker come on top, so you need cash beyond the down payment.
Add this calculator to your website
Free for olim organizations, real-estate agents, lawyers and blogs: paste this code into your page. We keep it up to date; nothing to install.