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Morgan Mortgage

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CONTACT US: 0525-688-940     aaron@morganmortgage.co.il
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Mortgage Overview

The Process / Qualifying for a Mortgage / Mortgage Options / Hidden Costs In A Mortgage / Fixed Rate or Variable Rate? / Prepayment / How much can I borrow? / How much will I pay per month?

The Process

It is strongly advised to get approved for a mortgage before signing a purchase contract.  As opposed to other countries where a home purchase can be “conditional upon financing”, a purchase contract for a property in Israel is considered final once the purchase contract is signed.

It is also important to note that a bank will approve a borrower based on a percentage of the appraised value of a property.  Appraisers will often undervalue properties.  For this reason, it is often recommended to have a property appraised before signing a purchase contract in order to determine exactly how much money the mortgage bank is willing to lend.

Qualifying for a Mortgage

Lending institutions in Israel generally approve mortgage applications based on a borrower’s income.  A borrower’s assets can contribute to the strength of the application, but the income is a much more relevant factor in approving the mortgage.  Cosigners and Guarantors (in Israel or abroad) for the mortgage can also be used in the event that the borrower does not have sufficient income.

Mortgage Options

There are a number of mortgages options available.  Mortgages can be in Shekels, US Dollars, as well as a number of other currencies.  Within each currency, there are a number of mortgage options.  The choice of your mortgage should be carefully customized to match a number of factors, including:  The currency of your income, budgetary constraints, and risk adversity.  Mortgages are generally available up to a maximum of 30 years.

Hidden Costs in a Mortgage

Comparing and choosing the best mortgage option can be challenging.  Many mortgages have hidden costs which can significantly increase the cost of the mortgage.  An independent mortgage professional can advise you on the most economical option and help you avoid the hidden traps of the Israeli mortgage system.

Fixed Rate or Variable Rate?

There are a wide range of fixed and variable options, each with its own advantages and disadvantages.  Borrowers need to be cautious to understand these terms as they have different definitions than mortgages abroad.

Prepayment

Some mortgage options in Israel have pre-payment penalties in the event that the borrower wants to either prepay the mortgage or sell the property before the mortgage is paid off.  Generally, variable rate mortgages have no pre-payment penalty.  Fixed rate mortgages will generally have a smaller penalty if the lock-in period of the interest rate is shorter.

How much can I borrow?

Israeli lending institutions will generally lend a maximum of 75% of the price of a property if it is the buyer’s first property purchase.  The banks will lend 70% of the price of a property if it is not the buyer’s first property and if the buyer does not own any other properties.  The banks will lend 50% of the price of a property for second (or investment) properties.  Borrowers that do not have a teudat zehut (Israeli ID) are also limited to 50% financing.

How much will I pay per month?

The following table shows how much a borrower will pay monthly for a 1,000,000 NIS mortgage over a 20, 25 and 30 year period.

Monthly Mortgage Payments for a 1,000,000 NIS Mortgage
Interest Rate 3.5% 5% 6.5%
20 years 5,800 NIS 6,600 NIS 7,456 NIS
25 years 5,006 NIS 5,846 NIS 6,752 NIS
30 years 4,490 NIS 5,368 NIS 6,321 NIS

MORTGAGE CALCULATOR

MortgageLoan.com

Testimonials

Aaron helped me in three ways. Firstly, he made the time consuming pain and stress of getting a mortgage disappear. Secondly, he saved me multiple times my investment for his service, by getting me an mortgage that I simply couldn’t have got on my own and I’ve been in Israel for over a decade. And thirdly, Aaron gave me sound advice, that saved me from extra fees and interest charges in our new project and which saved me at least 10,000 NIS. And to add to this, he’s a real mensch and a pleasure to work with.
A. Lewis, RBS
It can be a daunting experience buying property in Israel for the first time! Baruch Hashem when we went through this process we had the help of Aaron Morgan who assisted us each step of the way. We found him to be professional, knowledgeable, helpful and a real mensch! We wouldn’t hesitate to recommend him to anyone who wants to make their property purchase in Israel a smoother and more pleasant experience!
David Mazabow, RBS
Aaron was extremely helpful and a pleasure to work with the whole way through. Even before we had made a commitment to work with him he was always available on the phone to explain how mortgages work and what options we had. Once we had agreed on the mortgage, he made every step as hassle-free for us as possible going above and beyond what I had expected him to do on our behalf.
R. Fishel, RBS
After years of “trauma” dealing with banks and offices to buy and sell homes, I want to heartily recommend Aaron Morgan.  He took all the pain, pressure and headache out of this process, as well as getting us the best rates and terms. He is quick, efficient and a pleasure to deal with. If you are buying or selling, check him out and sleep well tonight!
Eli Lepon, RBS Resident
Aaron Morgan is Hashem’s shaliach for Olim. We were fresh off the boat, and illiterate in Hebrew. Aaron was there for us, and handled EVERYTHING for the purchase of our apartment!! He got us the best loan, when everyone said it could not be done…he handled all the paperwork, negotiating, signing, all clearly explained in English, calmly and with derech eretz!
The Bell Family, RBS Residents
I feel compelled to share my great experience with Aaron Morgan.  First and foremost he comprehensively addressed my questions and concerns with regards to my mortgage.  And he did this professionally and with a show of knowledge and experience.  But then, possibly even more significant, is that he went on to give me advice that has MY best interest in mind even though it meant less business and income for him.  This type of honesty and integrity is wonderful to see and experience!
Roi Zadok, RBS Resident
I would like to highly recommend Aaron Morgan to help you find a mortgage. I tried to do it myself by going to different banks and negotiating but lost too much time and patience dealing with different banks. I gave over my quest to Aaron Morgan and what a blessing it was. Aaron is very knowledgeable and has the connections in different banks to make things work. He’s a pleasure to work with, is a big mentch, and B’H got me a great rate plus good reductions on many costs.
R. Stewart, RBS Resident
Aaron Morgan provides a full service mortgage package to his clients. He takes care of all the fine details from the stage of getting pre-approved until the mortgage is released. He also gets great rates and he is a real mentch.
Anonymous, RBS Resident
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