Real Estate Japan | Tokyo, Osaka, Nagoya Properties For Rent & Sale

Many local banks in Japan have become more proactive than ever in approving housing loans made by non-Japanese applicants.  Once you have found a home in Japan, knowing what to do and how to go about it might encourage you to seriously explore the possibility of securing a mortgage.  It is not as hard as it used to be and it is not as hard as it seams.

General prerequisites for non-Japanese residents to apply for a housing loan:

• ‘Must’ reside in Japan
• ‘Must’ be able to produce local income evidence and record of local tax payment. (Such evidence can be ‘Certificate of Tax Payment’, ‘taxation certificate’, or ‘employer’s certificate of income and local tax withheld’)
• ‘Must’ use the property as your home residence.
• ‘Must’ be able to communicate at the beginner’s level and write own name and address in Japanese characters.

In addition you will need:

• Certificate of Tax Payment: ‘Nou-zei sho-mei-sho’
• Taxation Certificate: ‘Kazei sho-mei-sho’
• Employer’s certificate of income and local tax withheld: ‘Gensen-cho-shu-hyo’

Prerequisites and criteria for loan approval and necessary papers to submit:

• Loan rate (percentage, fixed or variable?)
• Loan period
• Method of repayment
• Guaranty, filing charge, insurance

Typical case of ‘approved’ housing loan for non-Japanese resident:

• Maximum loan amount: Up to JPY100 Million (1 ‘Oku’), depending on applicant’s income amount.

Occasionally, an amount more than the max level can be considered subject to a bank’s determination. Until recently, most banks did not finance the full amount of property’s sale value, but now if adequate income evidence is shown during the application, the loaned amount can be as high as almost the full amount of the property’s price.

• Loan period: Up to 35 years at most (Applicant’s age at the expiry should by 75 years old or less)
• Type of loan rate: fixed or variable.

General procedures for purchasing a property:

• Application
• Conclusion of sale contract
• Loan application & property appraisal
• Loan approval by bank
• Consolidation of sale contract as irrevocable agreement

(in case of failure)

• Loan disapproval by bank
• Discharging the sale contract

* Most sale contracts contain ‘termination clause’ (also called ‘contingency clause’) to withhold a discharging possibility in a case that bank disapproves the loan application. With the clause, buyers are entitled to discharge the sale contract without any penalty (except the paid stamp duties).

*Typical provision of the termination clause:

“In the event that the sale contract is discharged due to resulting loan disapproval by the bank, the sale contract shall immediately cease effect upon disapproval being revealed, and the Seller shall immediately repay to the buyer all the amount paid without interest.”

Banks and financial institutes in Japan providing loan approval opportunity for non-Japanese residents:

Suruga Bank

GE Money

It is always best to clarify with a bank in advance of making a loan.  Each institution will have some variables that you will be required to fulfill, especially if you are purchasing with an intent to invest.

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