Understanding Mortgages in Israel

We understand this industry like no others.

We have written several articles about the real rules of Israeli mortgages. It is not difficult to find a long list of rules that amateurs put out. Most of them are irrelevant. It is nearly impossible to find real rules, that we provide here as a service to our clients.

These articles were originally published in the Understanding Israeli Mortgages blog. You should subscribe to the blog to get regular updates on finances in Israel and how they affect Shlomo Homeowner.

Real Israeli Mortgage Rule #1:
Don't go into your bank branch

The most common error that we get from new clients is that they have already gone into the branch where their personal account is managed and speak with the mortgage clerk there.

It seems almost natural that we should go to the people we "trust" with our money, right? Wrong! Banks know all about client stickiness, this why they make attractive offers to students and soldiers. Most people open up an account and won't leave their bank for tens of years, if ever. When is the last time you switched banks? When the bank knows that it has you in its pocket, it makes much less of an effort to give you the most competitive offer.

Stop! Don't talk to the loan officer at your branch.

Your bank also likely makes you very attractive sounding offers to make you come in and ask. Last year a bank offered clients 0% mortgages for five years if they move their banking. Another bank offers you a subsidized mortgage. Yet another recently advertised 1% mortgages. All of these are nothing more than efforts to pull the wool over your unsuspecting eyes. They'll give you 60,000 NIS @0% for five years, but they'll also take a much higher rate on the remaining 582,000 loan that you'll be taking.

From our standpoint as professional mortgage advisers it also makes life much harder for us representing your interests. Once you've been to a bank, there is a good chance that you have been locked into it and that we can't take you to a different branch of the same bank should the circumstances demand it. Banks work the same way as many other businesses, and there is no uniformity of programs or prices throughout the different branches of the same bank. Your personal account may be managed in branch #123 of the Second National Bank, but we may be able to get you a better loan at branch #126. Leave us this flexibility.

Rule #1: Don't just go into your branch or call up the banks mortgage hot line. You could be locking yourself out of the best deals.
Corollary to rule #1: set up a mortgage consultation with us before you start on your mortgage process.

If you've already done this, don't despair. There is still a lot that we can do for you, but you will get the best results by speaking to us.. 

More Rules

Rule #2: Timing

Rule #3: What's Really Important

Rule #4: Constant Change 

Rule #5: Consolidate Debt Early

Independent mortgage advice

As experienced mortgage professionals, we have the knowledge and financial services expertise to find you the loan programs most suited to your family's needs, also with the lowest rates and the best possible terms. We take the hassle out of organizing your finances and help at every step of the mortgage process.

We are Israeli Mortgage Professionals. Don't even consider going into a bank before you talk to us.