Updating Procedures for Granting Housing Loans in Israel
March 07, 2019
When looking into properties for sale in Israel most people take a mortgage to fund some of the amount of the purchase. The Bank of Israel gave an update to the banks relating to the assessment of the property to make it easier for buyers.
- Recently there has been need in improving the process in obtaining a housing loan in Israel. Specifically improving the process of assessing a property already in a premature stage. In order to do this the banks will have to include a list of assessors (that are authorized by the bank) along with the approval of the mortgage at the same time, not after the buyer has signed on the property. This way, the buyer will know before signing how much the assessor has valued the property for sale in Israel.
- After having used this assessor and the buyer decides to go to a different bank, the new bank must accept the figure provided by the assessor (given that this assessor is authorized by the new bank, and it is within 90 days from the original assessment) unless the bank has a legitimate reason as to why they cannot accept the figure.
- It has been updated that all banks must list the rebate (interest) information in clear format on the internet and/or an application, so the buyer has all the information they need to decide if it is worthwhile for them to pay off some of their mortgage in a lump sum early.
- If the buyer does pay off some of mortgage early, the insurance amount being paid will change accordingly as well. The bank must provide a letter addressed to the insurance company that it has agreed to lower the insurance amount according to the early payment of the loan.