If you're thinking of buying a home in Japan, understanding how mortgage loans (jutaku roon) work is essential. While the process is relatively standardized, there are specific eligibility conditions, loan types, and considerations for foreigners that you should know before applying.
What Is a Mortgage Loan in Japan?
A mortgage loan is a long-term home loan used to finance the purchase of property. Most loans have terms up to 35 years, with both fixed and variable interest rate options. Your income, residency status, and employment history all play a key role in loan approval. Some lenders now even offer 50-year loans, especially for younger borrowers.
Basic Mortgage Requirements (Typical Case)
| Requirement | Details |
|---|---|
| Age | 20 to 65 (loan must be fully repaid by age 80) |
| Annual Income | Typically ¥3M~¥4M minimum |
| Employment | At least 1 year at current job (full-time preferred) |
| Health | Must join group life insurance in most cases |
| Down Payment | 10~20% of property price, plus taxes and fees |
| Japan Residency | Ideally 2+ years of residency to prove financial stability |
Special Notes for Foreign Residents
| Requirement | Explanation |
|---|---|
| Permanent Residency (PR) | Makes loan approval easier at most banks, but non-PR also possible |
| Length of Stay in Japan | Typically at least 2 years with work history |
| Income Proof | Past 2~3 years of tax statements or income slips required |
| Down Payment | 10–20% required if you don't have PR |
| Japanese Language Ability | Some banks require direct understanding of contract (no interpreter allowed) |
| Japanese Spouse | Can co-sign or co-own, often helps with approval |
Example: How Much Can You Borrow?
Many banks use a rough guideline of 8× your annual income as the maximum loan amount.
Example: If you earn ¥6M/year → You may be able to borrow between ¥30M~¥42M depending on the bank's internal rules.
Popular Interest Rate Options (2025 Market Estimates)
| Interest Type | Common Providers | Approx. Rates (as of mid-2025) | Pros | Cons |
|---|---|---|---|---|
| Variable Rate | SBI, au Jibun Bank, etc. | 0.60%~0.70% | Lowest initial rate, ideal for short-term stay | Sensitive to future rate hikes |
| 10-Year Fixed | Rakuten, PayPay Bank, etc. | 1.55%~2.20% | Predictable payments for 10 years | May rise sharply after fixed period ends |
| Fully Fixed (e.g., Flat 35) | Japan Housing Finance Agency | 1.89%~2.11% | No surprises, good for long-term residents | Highest monthly cost and total interest |
Final Tips
- You can still buy property and get a loan without permanent residency, especially with strong income and savings
- Lenders favor applicants with stable full-time employment, proof of income, and longer residency
- Be prepared for significant documentation — in Japanese — and consider hiring a bilingual agent
- Buying a home in Japan as a foreigner is possible, and thanks to historically low interest rates, it's more accessible than many think