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Homepage > Mortgages > General Information > Collateral and Documents

Collateral and Documents

List of collateral and documents for opening a loan portfolio for an approved application

Upon approval of your mortgage application, you will be asked to sign the loan documents.  The mortgage consultant will provide you with a detailed explanation of the documents and the signing process, manner of recording the collateral, etc.  After providing the collateral and the documents required to Bank satisfaction, you will be able to receive the loan.


Collateral


Loan Registration Undertaking


An undertaking signed before a lawyer by the owner of the property rights (seller of a second hand apartment, housing company, contractor or ILA) to the Bank.


The undertaking is granted when the mortgage cannot yet be registered in the land registration bureau and it comprises a temporary guarantee, limited in time, pending the actual registration of the mortgage.


Registration is subject to a fee paid to the relevant factor.


Entering a Caveat Warning in favor of the Buyer/Bank


A warning is registered in the land registry (and appears on the land extract) regarding the property in order to warn anyone interested in the asset that there are additional right holders to the property and warn against creditors of the registered owner.


The warning is registered in favor of the buyers by force of the acquisition agreement and/or in favor of the Bank, against an undertaking to register a mortgage to the asset.


Registration is subject to a fee paid to the relevant factor.


Mortgaging Rights


Mortgaging rights is the encumbrance of the contractual rights to the asset (granted under the acquisition contract) in favor of the Bank, pending actual registration of the mortgage.  The encumbrance is performed with a "Mortgage Notice" document that will be issued by the Bank and which you will be requested to sign and record with the Registrar of Mortgages.


Mortgage registration is subject to a fee paid to the Ministry of Justice.


Guarantors


In certain instances, the Bank requires guarantors for the loan, who will be required to submit the relevant approvals.


Documents


Guarantee according to the Sales Law


A duly granted guarantee, usually issued to the Bank accompanying the project in which the borrower acquired an apartment, in order to guarantee the amounts thereby paid to the contractor, against the apartment whose construction is yet incomplete, in the event of contractor insolvency, inability to transfer the rights to the apartment to the buyer, etc.


Notarized Power of Attorney to the Bank


The Bank usually requests a power of attorney signed before a notary, verifying the signatures of the borrowers, where they authorize the Bank to act toward registering the asset in their name and asking the relevant authority to register an encumbrance or mortgage in favor of the Bank.

 

Assessor Estimate


To ensure that the asset that you intend to encumber is solid collateral for the Bank, or that the requested amount complies with the value of the asset, the Bank requires an estimate from a land assessor.


An assessor must be contracted from the list of assessors authorized by the Bank.  Payment shall be made directly to the assessor.  The available credit framework shall be derived of the value of the asset according to the acquisition contract or of the assessor's estimate – whichever is lower.


Insurance


In order to receive a mortgage, the Bank requires the borrowers to acquire property and life insurance policies:


Property – Structural Insurance


The Bank requires that the asset to be encumbered to it under the loan and serving as collateral thereto, shall be insured by structural insurance, including mainly insurance against earthquakes, fire and pipe damages.


Life Insurance


This insurance guarantees that, in the event of the untimely passing of one of the insured borrowers, the insurance company shall pay the Bank the balance of the loan not yet due.  Borrower's acquisition of life insurance is subject to age and proper health, as per the terms set forth by the insurance company.


You may purchase the insurance through the Bank's insurance agency at the self service stations in the branches or independently – subject to Bank requirements.


Mortgage Insurance


Obtaining a mortgage application

Mortgage Guide
General Information
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