Home loan rates have been at historically low levels in Japan in recent years. This is thanks to the Government's continued fiscal expansion policy.
The variable rate mortgage has been available at around 0.5% p.a. whereas the fixed rate mortgage has been at around 1.3% p.a. depending on terms.
To take advantage of the low rates, foreigners must have residency in Japan.
People with the Permanent Resident visa (PR) will be treated as the same as Japanese people for loan purposes and will have a chance to borrow 100% on the property, as well as for the transaction expenses (about 7%). Generally speaking, a stable job with an annual salary of more than 3 million yen is necessary. A reasonable level of Japanese language is also required. You can borrow roughly 10 times of your annual income, e.g. if 3 million, 30 million.
Even if you do not have PR, if you have been in the country for about 5 years or more, have been on the job for more than 3 years and have been at the same address for 3 years, then you will have a chance to get a 100% loan. If you have some evidence of savings, locally or overseas, this will be advantageous. A reasonable level of the Japanese language is still required.
If you have been in the country for less than 5 years but have a good job and good pay, you will have a chance for a loan without Japanese language skills. You will be offered only 80% or less. However, the rate will be still low by international standards.
In every case, the applicant must have a clean credit record in Japan.
Above are general requirements that we have observed from over 12 banks. Banks look at each case on their merits, so we always try several banks and choose the best for our clients.
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