Non-resident mortgage in Japan: lenders, conditions and process

How a non-resident mortgage works in Japan

Japan places no general nationality restriction on owning land or buildings, so a person living in Singapore, London or Taipei can hold freehold title in Tokyo. The obstacle is finance: most city banks and regional banks lend only to residents with a Japanese income history.

The loans that do exist for borrowers abroad are usually yen-denominated, secured by a registered mortgage right (teitoken) over the purchased property, and underwritten on overseas income and assets. Lenders treat them as investment or second-home loans rather than standard owner-occupier housing loans.

Lenders that accept borrowers living abroad

Tokyo Star Bank has built a niche lending to offshore buyers; Bloomberg reported in 2024 that the bank was expanding loans to overseas homebuyers, and Japan Property Central reported in 2015 that it had started offering Japan home loans to residents of Taiwan.

Shinsei Investment & Finance, an SBI Shinsei group company, finances purchases by buyers based outside Japan, as Real Estate Japan explains. SMBC Trust Bank PRESTIA serves foreign nationals in English and is often where expatriates bank before moving abroad.

Comparing the three lender types

The three routes differ less in headline rate than in who they target, how much equity they expect and whether a Japanese address is needed at any stage. The table summarises what each provider type is known for, without quoting rates that change frequently.

Who these loans suit

They suit salaried professionals or business owners with documented income abroad, a clean home-country credit file and savings for a substantial deposit. Buyers of central Tokyo, Osaka or Kyoto condominiums usually find lenders more receptive than buyers of rural houses.

They suit less well anyone relying on rental income alone, buyers of old wooden houses with little collateral value, and people close to retirement age, because Japanese lenders usually require full repayment before a set maximum age, which shortens the available term.

Legal framework for buyers living outside Japan

Lending is supervised by the Financial Services Agency, and banks follow Japanese anti-money-laundering rules that require verified identity, address and source of funds. A non-resident buyer should expect enhanced due diligence on where the deposit comes from and how it reaches Japan.

Foreign exchange reporting after purchase

Under the Foreign Exchange and Foreign Trade Act, a non-resident acquiring Japanese real estate generally files a post-acquisition report with the Minister of Finance through the Bank of Japan within twenty days. Exemptions exist; confirm the requirement with the judicial scrivener handling registration.

Land near sensitive facilities

Since 2022 a separate law allows the government to designate zones around defence facilities and border islands where transactions require prior notification or monitoring. Most urban condominiums fall outside these zones, but a lender may ask for confirmation before approving security over affected land.

Costs and conditions to expect

Lenders and brokers commonly describe deposits of roughly 30 to 50 percent for non-resident borrowers, against far smaller deposits for residents. Rates exceed resident housing-loan rates and are often variable, and they have drifted upward since the Bank of Japan ended negative rates in 2024.

Transaction costs add several percent to the price: capped brokerage commission, registration and licence tax, stamp duty on both contracts, real estate acquisition tax, judicial scrivener fees, fire insurance and often group credit life insurance or equivalent cover.

Step-by-step process from abroad

A purchase financed from overseas takes longer than a cash purchase because loan approval, document certification and international transfers must be lined up before settlement. The sequence below reflects how lenders serving non-residents usually organise the file.

1. Ask two or three lenders for written eligibility criteria covering your country of residence, income currency and the property type.
2. Obtain a pre-assessment before signing the purchase application, so the deposit level is known.
3. Sign the sale contract with a loan contingency clause and pay the earnest money through a traceable bank transfer.
4. Submit certified identity, income and asset documents, translated where the lender requires.
5. Appoint a judicial scrivener and, for later property tax, a tax representative in Japan.
6. Sign the loan agreement, transfer the balance and complete registration of title and mortgage right on the same day.
7. File any required foreign exchange report and set up yen payments for instalments and local taxes.

Documents and signature formalities

Japanese registration relies on registered seals, which non-residents normally lack. Instead, lenders and scriveners accept a signature certificate issued by a Japanese embassy or consulate or by a local notary, together with an address certificate, passport copy and recent tax returns or audited accounts.

Expect requests for employment letters, bank statements covering several months, proof of the deposit's origin and existing debt statements. Documents often must be recent, typically issued within three months, so order certificates late enough that they remain valid on completion day.

Currency and rate risk

A borrower earning dollars, euros or Hong Kong dollars repays in yen, so a stronger yen raises the real cost of each instalment. With a variable rate tied to Bank of Japan policy, payments can rise from two directions; stress-test both.

Mistakes and red flags

Most problems arise before the loan is signed, when buyers rely on informal promises from agents, developers or self-described loan arrangers. The warning signs below are specific to financing Japanese property from abroad, where distance makes verification harder.

• An intermediary claiming to arrange a Japanese bank loan for a non-resident in exchange for an upfront processing fee paid to a personal account: genuine lenders do not work this way, and this is a classic advance-fee scam.
• Signing a sale contract without a loan contingency clause, then losing the earnest money when finance is refused.
• Assuming the lender will accept an old rural house as collateral; many will not.
• Ignoring the maximum age at final repayment, which can cut the term and raise instalments.
• Not checking that the lender or agent is licensed; consult the Financial Services Agency list of licensed financial institutions and the prefectural real estate licence register.

Frequently asked questions

The answers below address recurring questions from buyers who live outside Japan and want to finance a purchase in yen. Conditions change and vary by lender, so treat them as orientation and confirm details in writing.

Can a non-resident get a 35-year loan in Japan?

Rarely. Long terms are mostly linked to resident housing loans and public-backed products. Lenders serving borrowers abroad typically offer shorter terms and cap the borrower's age at final repayment, so the realistic term depends heavily on how old you are when applying.

Does a foreigner need permanent residency to borrow?

For mainstream resident housing loans, many banks ask for permanent residency or a Japanese spouse. Non-resident programmes work differently: they assess overseas income and assets instead, which is why only a few specialist lenders and finance companies offer them.

Is group credit life insurance required?

Many Japanese mortgage products include group credit life insurance that repays the loan if the borrower dies. Eligibility for non-residents varies, so some lenders substitute other cover, require a larger deposit or accept a guarantor; ask which option applies before applying.

Who pays local property tax when the owner lives abroad?

Fixed asset tax and city planning tax are billed annually by the municipality. An owner living abroad usually appoints a tax representative in Japan to receive notices and pay on time, because missed payments can lead to penalties and complicate any later refinancing.

By Nabil Frik · Updated 13 October 2026