In recent years, there has been an increase in the number of people wishing to immigrate to Japan or work in the country, and this trend seems to be gaining momentum, particularly as international travel restrictions have eased following the end of the COVID-19 pandemic. Among these individuals, there are those who desire to own a home in Japan rather than rent one.
However, purchasing a house is not a cheap endeavor, and in many cases, it involves taking out a home loan. So, the question arises:
What are the options for foreigners when it comes to home loans in Japan?
Can they even avail themselves of this option? In this blog, we will explore the topic of home loans for foreigners and discuss the key points to keep in mind.
Click :the merit of using home loan (written in Japanese)
Challenges of Obtaining a Home Loan for Foreigners
First and foremost, it’s essential to understand that for foreigners, obtaining a home loan in Japan is generally not a straightforward process. Financial institutions typically assess a borrower’s ability to repay by examining stable income and creditworthiness. For foreigners, additional factors such as immigration status and the duration of their stay are also considered as part of the evaluation.
Differences Based on Immigration Status
If you hold permanent residency:
When an individual holds permanent residency, they often undergo a relatively standard evaluation process, similar to that applied to Japanese citizens. This can make the process more accessible for them.
If you do not hold permanent residency:
On the other hand, if you do not possess permanent residency, there are typically more stringent requirements when applying for a home loan. Some specific conditions may include:
- Having a Japanese spouse or a spouse with permanent or special permanent residency as a joint guarantor.
- Having a Japanese spouse or a spouse with permanent or special permanent residency as a joint debtor.
- Providing a substantial percentage of the purchase price as self-funding.
- Holding a residence status that allows unrestricted employment in Japan.
It’s crucial to be aware that without permanent residency, obtaining a home loan as a foreigner can be quite challenging.
Financial Institutions Open to Providing Home Loans for Foreigners
Moreover, it’s worth noting that the number of financial institutions willing to offer home loans to foreigners without permanent residency is limited, and in many cases, they might be hesitant to do so. Therefore, when researching the specifics of home loans, it is advisable to consider institutions that explicitly state their willingness to work with such individuals.
Suruga bank: variable interest type (written in Japanese)
SBI Shinsei bank: various interest types are provided (written in Japanese)
AEON bank: variable interest type (written in Japanese)
Tokyo star bank: various interest types are provided (written in English)
