Japan mortgage options for foreigners explained (2026)

Authored by the expert who managed and guided the team behind the Japan Property Pack

Everything you need to know before buying real estate is included in our Japan Property Pack

Who is the author of this content?

BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Japan. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At BambooRoutes, we explore the Japanese real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Tokyo, Osaka, and Kyoto. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

How easy is it for foreigners to qualify for a mortgage in Japan right now?

Qualifying for a mortgage in Japan as a foreigner has become more challenging in 2025-2026, with banks tightening their requirements.

As of September 2025, permanent residents have the easiest path to mortgage approval, with most major banks treating them similarly to Japanese citizens. Non-permanent residents face additional hurdles including higher down payment requirements, stricter income verification, and longer employment history requirements.

The approval process typically takes 2-4 weeks for permanent residents versus 4-8 weeks for non-permanent residents. Banks now require at least 1-3 years of stable employment in Japan for non-PR applicants, compared to 6-12 months previously. Foreign-friendly banks like Tokyo Star Bank and Prestia SMBC offer specialized programs that can approve qualified applicants with work visas or spouse visas within similar timeframes.

Your chances improve significantly with a Japanese spouse as co-borrower, annual income above ¥4 million, and strong documentation of financial stability. Banks also favor applicants working for established companies or government positions over freelancers or contract workers.

It's something we develop in our Japan property pack.

What minimum down payment do banks usually require from non-Japanese buyers?

Most Japanese banks require a minimum down payment of 20% from foreign buyers, though this can increase to 30-50% depending on residency status and lender type.

Permanent residents typically face the same 10-20% down payment requirements as Japanese citizens at most banks. Non-permanent residents with stable visas (spouse, work, highly skilled professional) usually need 20-30% down payment. Non-residents or those with temporary visas may face requirements of 30-50% or higher.

Megabanks like MUFG and Sumitomo Mitsui Banking Corporation typically require 20-30% down payment from foreigners. Regional banks may ask for 25-40%, while foreign-friendly lenders often accept 20-25% with proper documentation. Some online banks like au Jibun Bank offer competitive rates with down payments as low as 10% for qualified foreign residents.

The exact percentage also depends on property type and location. Urban apartments in Tokyo or Osaka may qualify for lower down payment percentages, while rural properties or older buildings might require 40-50% down payment regardless of borrower nationality.

What are the current interest rate ranges offered to foreigners in 2026?

Interest rates for foreigners in Japan range from 0.18% to 1.4% as of early 2026, varying significantly by bank type and borrower profile.

Foreign-friendly banks offer the most competitive rates, with au Jibun Bank and PayPay Bank offering variable rates starting at 0.18-0.3% for qualified foreign residents. Traditional megabanks typically offer rates between 0.4-0.8% for permanent residents, rising to 0.8-1.2% for non-permanent residents.

Fixed-rate mortgages are generally 0.2-0.5% higher than variable rates. Ten-year fixed rates range from 0.8-1.4% across most lenders. Regional banks fall in the middle range of 0.5-1.0% for variable rates, while specialized non-resident programs can charge 1.5-2.5% or higher.

Your actual rate depends on loan-to-value ratio, employment status, and relationship with the bank. Borrowers with permanent residency, high incomes (¥8+ million annually), and substantial deposits can access the lowest advertised rates. Those without permanent residency typically pay 0.2-0.5% premium above base rates.

How long are the standard mortgage terms available to non-residents and residents with visas?

Standard mortgage terms in Japan range from 15 to 35 years for both residents and non-residents with appropriate visa status.

Most banks offer 25-35 year terms as standard, with the maximum age at loan completion typically set at 65-70 years old. This means a 40-year-old borrower could qualify for a 25-30 year term, while a 50-year-old might be limited to 15-20 years.

Permanent residents can access the full range of term lengths offered to Japanese citizens. Non-permanent residents may face shorter maximum terms (20-30 years) or additional restrictions based on visa duration. Some banks require that the loan term not exceed the borrower's visa validity period plus expected renewals.

Shorter terms mean higher monthly payments but significant interest savings over the loan lifetime. Longer terms reduce monthly payments but increase total interest costs. Most borrowers choose 25-30 year terms to balance monthly affordability with reasonable total interest payments.

What documents and proof of income do Japanese banks specifically ask foreigners to provide?

Japanese banks require extensive documentation from foreign applicants, significantly more than what domestic buyers typically provide.

Essential documents include:1. **Valid passport and residence card** showing current visa status2. **Employment verification** - Letter from employer stating position, salary, and employment duration3. **Income documentation** - Last 3-6 months of pay stubs plus annual tax certificates (Gensen Choshuhyo)4. **Bank statements** - Typically 3-6 months showing salary deposits and spending patterns5. **Tax returns** - 1-3 years of filed returns demonstrating income stability6. **Property documentation** - Purchase agreement, property details, and planned use7. **Debt statements** - Details of existing loans, credit cards, and monthly obligations

Non-residents face additional requirements including notarized address verification, overseas income documentation with certified translations, and sometimes proof of ties to Japan. Banks may also request Japanese language proficiency certificates or require a bilingual guarantor to ensure loan terms are understood.

It's something we develop in our Japan property pack.

Do foreigners need a permanent residency status or can they borrow with a working or spouse visa?

Permanent residency is preferred but not universally required, with several banks offering mortgage products to foreigners holding work visas, spouse visas, or long-term resident status.

Megabanks (MUFG, Sumitomo Mitsui, Mizuho) strongly favor permanent residents and rarely approve loans for non-PR applicants unless they have Japanese spouses as co-borrowers. These banks view permanent residency as indicating long-term commitment to Japan and stable income prospects.

Foreign-friendly banks like Prestia SMBC, Tokyo Star Bank, Aeon Bank, and Suruga Bank specifically cater to non-PR foreign residents. These lenders accept work visas, spouse visas, highly skilled professional visas, and long-term resident status. Requirements typically include minimum 2-3 years remaining on visa, stable employment, and higher down payments.

Having a Japanese spouse as co-borrower significantly improves approval odds for non-PR applicants at all bank types. The Japanese spouse can act as guarantor and provide additional income stability that banks value highly.

What is the maximum loan-to-value ratio banks will allow for a foreign applicant?

Maximum loan-to-value (LTV) ratios for foreign applicants typically range from 70-90%, with permanent residents accessing higher ratios than non-permanent residents.

Permanent residents can often secure LTV ratios of 80-90%, similar to Japanese citizens, particularly for properties in major urban areas. Some megabanks may even offer 100% LTV for exceptional cases involving high-income permanent residents purchasing prime Tokyo properties.

Non-permanent residents usually face LTV caps of 70-80%, meaning they need 20-30% down payments. Non-residents or those with temporary visas may be limited to 50-70% LTV ratios, requiring 30-50% down payments. These restrictions reflect banks' concerns about repayment ability and legal recourse if borrowers leave Japan.

Property location and type also affect LTV ratios. Urban apartments in Tokyo, Osaka, or Yokohama may qualify for higher ratios, while rural properties or older buildings face stricter limits regardless of borrower profile.

How do mortgage options differ between Japanese megabanks, regional banks, and foreign-friendly lenders?

Lender Type	Pros	Cons
Megabanks (MUFG, Sumitomo Mitsui, Mizuho)	Lowest interest rates (0.3-0.8%), extensive branch networks, established reputation	Strictest requirements, limited English support, heavily favor permanent residents
Regional Banks	More flexible on property locations, sometimes more personal service	Higher rates (0.4-1.2%), limited to specific regions, most require PR or Japanese spouse
Foreign-Friendly Banks (Prestia, Tokyo Star, Aeon)	English language support, accept non-PR applicants, tailored loan products	Slightly higher rates (0.5-1.4%), more limited branch networks
Online Banks (au Jibun, PayPay)	Competitive rates (0.18-0.5%), streamlined digital processes	Limited personal support, strict documentation requirements
Non-Resident Specialists	Accept overseas applicants, specialized programs	High rates (1.5-2.5%), require large down payments (30-50%)

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Japan versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

Are there restrictions on what types of properties foreigners can finance with a mortgage in Japan?

Most banks limit financing to residential properties, with restrictions on age, location, and property type that can affect loan approval.

Banks typically finance standard residential apartments (manshon), single-family houses (kodate), and some townhouses in urban or suburban areas. Properties must be primarily residential - mixed-use buildings require at least 50-70% residential usage to qualify for residential mortgage rates.

Restricted property types include bare land, properties where deaths occurred (jiko bukken), buildings over 30-40 years old without major renovations, and rural or remote properties with limited resale potential. Some banks also restrict financing for properties smaller than 20-25 square meters or in areas with declining populations.

Investment properties face additional scrutiny, with some banks requiring higher down payments or refusing to finance properties intended for short-term rental (Airbnb). Properties in prime locations like central Tokyo, Osaka, or near major train stations generally face fewer restrictions and qualify for better loan terms.

How much do typical additional costs like registration tax, agent fees, and insurance add to the mortgage process?

Additional costs typically add 5-8% of the property purchase price, significantly impacting the total investment required beyond the down payment.

Major additional costs include:1. **Real estate agent commission** - 3% of purchase price plus ¥60,000 plus 10% consumption tax2. **Registration taxes** - Approximately 1.5% of land value plus 0.3% of building value3. **Mortgage registration fee** - 0.1-0.4% of the loan amount4. **Stamp duties** - ¥10,000-¥100,000 depending on property price5. **Property insurance** - ¥20,000-¥50,000 annually, usually required by lenders6. **Legal and administrative fees** - ¥100,000-¥300,000 for judicial scrivener, translations, and documentation

For a ¥50 million property with a ¥40 million mortgage, expect total additional costs of ¥2.5-4 million. These costs must be paid upfront and cannot typically be financed, requiring additional cash beyond the down payment.

It's something we develop in our Japan property pack.

Can foreigners refinance their mortgage later if rates change, and how flexible are Japanese lenders with this?

Foreigners can refinance their mortgages in Japan, but the process involves significant paperwork and banks may apply different approval standards than the original loan.

Most banks allow refinancing after 1-2 years of on-time payments, though some require 3-5 years. The refinancing process requires full re-qualification including updated income documentation, property valuation, and credit assessment. Banks may apply current lending standards, which could be stricter than when the original loan was approved.

Foreign-friendly banks tend to be more flexible with refinancing for non-PR residents, while megabanks may be less accommodating. Some borrowers switch from regional banks to online banks to access lower rates, though this requires meeting the new lender's foreigner qualification criteria.

Refinancing costs include application fees (¥30,000-¥100,000), new property valuation (¥100,000-¥200,000), and registration changes (¥100,000-¥300,000). Rate improvements of 0.5% or more typically justify these costs over the remaining loan term.

What are the biggest risks and pitfalls that foreigners face when taking a mortgage in Japan, and how can they be avoided?

The biggest risks include language barriers, unexpected costs, restrictive loan terms, and limited legal recourse if problems arise.

Common pitfalls and solutions:1. **Language barriers** - All documentation is in Japanese; engage bilingual real estate agents and legal advisors2. **Underestimating total costs** - Budget 25-30% beyond property price for down payment and closing costs3. **Visa status changes** - Some loans require immediate repayment if visa status changes; verify terms carefully4. **Property value risks** - Japanese real estate can depreciate; focus on locations with stable demand5. **Interest rate changes** - Variable rates can increase; consider fixed-rate options for predictability6. **Early repayment penalties** - Some banks charge 1-3% penalties; negotiate flexible terms upfront7. **Limited lender options** - Loan rejection at one bank doesn't guarantee approval elsewhere; apply to multiple lenders

The most effective strategy is working with experienced bilingual mortgage brokers who specialize in foreign clients. These professionals can navigate bank requirements, translate documents, and identify the most suitable lenders for your specific situation. Always verify all terms in writing and budget conservatively for unexpected costs.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Expatica - Japan Mortgage Guide
2. E-Housing Japan - Housing Loans Guide
3. Solid Real Estate Japan - Foreign Buyer Mortgages
4. Eaves Japan - Non-PR Mortgages
5. Wise - Mortgage in Japan Guide
6. Tokyo Luxury Towers - Mortgage Financing Guide
7. Real Estate Tokyo - Loan Information
8. Real Estate Japan - Banks Lending to Foreigners