As of May 2025, Japan offers a variety of housing loan options through both private banks and government-backed programs like the Flat 35. Here's an overview of current mortgage interest rates and key lenders:

Many Japanese banks provide competitive mortgage rates, catering to both residents and non-residents. Here are the Private banks offering home loans:

What are the Banks Offering Home Loans in Japan?

  • Offers variable rates as low as 0.179%.

  • Provides variable rates starting at 0.270%

  • Offers rates around 0.320%

  • Rates approximately 0.700%

  • Approximately 0.970%

  • Around 1.050%

  • Approximately 1.200%

  • Around 1.380%

Here are major banks like Mitsubishi UFJ (MUFG), Sumitomo Mitsui (SMBC), and Mizuho Bank also offer competitive rates:

  • Variable rates starting at 0.475%; fixed rates from 1.2%

  • Variable rates around 0.475%; fixed rates beginning at 1.2%

  • Variable rates from 0.475%; fixed rates starting at 1.25%

What is Flat 35 Loan Program ?

The Flat 35 is a government-backed mortgage option offering fixed interest rates for up to 35 years.

  • As of December 2024, rates for loans up to 20 years with a loan-to-value ratio of 90% or less stood at 3.18%

  • Available to a wide range of borrowers, including first-time homebuyers

  • Provides stability with fixed monthly payments, making it ideal for long-term financial planning

what are the banks that provides Home Loan for Foreigners Without Permanent Residency?

There are several banks in Japan offer mortgage options tailored for foreigners without permanent residency:

  • Adjustable rates between 1.475% – 2.875%; no co-signer required

  • Adjustable rates from 1.13% – 1.38%; fixed rates between 1.78% – 2.13%; documents available in English

  • Adjustable rates 1.250% – 2.350%; fixed rates 2.000% – 3.650%; requires residency and Japanese proficiency

  • Adjustable rates 3.75% – 5.15%; no co-signer required

  • Adjustable rates 2.80% – 4.10%; requires a residence card

what are the Things to Consider in Choosing a Housing Loan in Japan?

1.Interest Rate Type

  • Commonly now as Floating rate. Starts lower but can fluctuate over time. Suitable if you expect interest rates to remain low or if you plan to repay quickly

  • Offers stability with consistent payments. Ideal for long-term planning and minimizing risk

2. Loan Term

Shorter terms mean higher monthly payments but less total interest paid

Longer terms reduce monthly burden but increase the overall cost of the loan

  • Typical Duration: 5-15 years

    Suitable for: High-income borrowers who want to pay off debt quickly and minimize interest

    Impact of Shorter Term (e.g., 15 years)

    • ✅ Lower total interest paid

    • ✅ Loan cleared faster

    • ❌ Higher monthly payments

  • Typical Duration: 16 – 25 years

    Suitable for: Balanced option for those who want manageable payments and lower total interest.

  • Typical Duration: 26 – 35 years

    Suitable for: Most common choice in Japan, especially for first-time buyers using Flat 35 loans.

    Impacts of Longer Term (e.g., 35 years)

    • ✅ Lower monthly payments

    • ❌ Higher total interest over time

    • ❌ Risk of carrying debt into retirement

  • Duration: Up to 50 years (rare)

    Suitable for: Offered by select banks, often for younger borrowers with lower initial incomes.

3. Eligibility Requirements

Check the bank’s specific criteria

  • In Japan, housing loan terms typically vary depending on the lender and the borrower's financial profile. Here's a breakdown of commonly available loan terms and what they mean for you

  • some banks accept non-permanent residents, most don’t

  • matters at the start and end of the loan

4. Documentation

Even if the bank offers English assistance, most official documents must still be submitted in Japanese.

5. Additional Costs

Be aware of hidden or upfront charges

  • if you plan to pay off the loan early

6. Smart Financial Planning

  • Align your mortgage decision with long-term goals (e.g., staying in Japan, retirement planning)

  • Consider combining Flat 35 for long-term stability with a bank loan for initial flexibility.

    Fixed-rate loan up to 35 years

    • Available to a wide range of buyers

    • Interest rates are fixed regardless of market changes

  • Some banks allow:

    • Early repayment (partial or full)

    • Loan term adjustments mid-way (with possible fees)

7. Language

Some banks offer English-language support and contracts. If your Japanese is limited, prioritize these institutions

  • Full English Service. Contracts and Costumer support in English.

  • English website and support. Known for foreigner-friendly support.

  • Offers home loans for non-permanent residents

  • Strong expat support. Also offers multi-currency accounts

  • Limited English. Often work with intermediaries for expats.

How long is the Recommended Waiting Time to reapply after failing the home loan?

( Based on reason for rejection )

  • You can reapply immediately once corrected

  • Immediate reapplication is possible after adjustments

  • Wait 6 months to 1 year after improving income stability

  • Wait 6 months to 2 years, depending on the severity

Importance of waiting

  • Credit bureaus often take 3–6 months to reflect improvements.

  • May remain on your record for up to 5 years; wait at least 1–2 years before reapplying.

  • If rejection was due to low or unstable income, wait until your financial profile strengthens.

What Should You Do Before Reapplying?

    1. why your application was rejected.

  • income, debt, documentation, etc.

  • Description text goes here

  • only reapply when something has meaningfully changed in your financial or personal profile since your last application.

    1. Higher or more stable income
      → You got a raise, a full-time contract, or have been at your job longer.

    2. Improved credit score
      → Paid off debts, resolved late payments, or reduced your credit utilization.

    3. Lower debt-to-income ratio
      → You’ve paid off car loans, credit cards, or other obligations.

    4. Larger down payment
      → More savings can reduce the bank’s risk.

    5. Better property or guarantor
      → A different house or a co-signer with good financials can help.

    6. Corrected documentation
      → You fixed errors or submitted all the required paperwork properly this time.

    Banks want to see improvement, not repetition — so make sure something looks different and better when you try again.