Updated: July 2026
Per the Pashut Neto calculator, as of 2026, a ₪1.2 million mortgage over 25 years at 5% annual interest requires a monthly payment of about ₪7,015 under the Spitzer (annuity) schedule.
The calculation uses the Spitzer schedule (fixed-payment annuity), used in most Israeli mortgages: the monthly payment is computed so that principal plus interest spreads evenly across the whole loan term.
In practice an Israeli mortgage is a mix of tracks — prime, CPI-linked and unlinked fixed, variable — each with its own rate. The calculator assumes one uniform rate, so the result is an order of magnitude for orientation, not a bank offer.
The Spitzer schedule is an amortization schedule with a fixed monthly payment for the whole term. Early on most of the payment is interest; over the years the ratio flips toward principal. It is the most common schedule in Israeli mortgages.
For a first (only) home, banks may finance up to 75% of the value, so you need at least 25% equity. For a second home and beyond, the maximum financing is lower.
The shorter the term, the higher the monthly payment but the significantly lower the total interest. For example, on a ₪1.2M mortgage at 5%: over 20 years the payment is about ₪7,919 and total payments about ₪1.9M; over 30 years the payment is about ₪6,442 but total payments reach about ₪2.32M — a difference of roughly ₪418,000 in favor of the shorter term.
Israeli banks generally cap the monthly mortgage payment at about 40% of net income. With a net income of ₪12,000, that means a payment of up to roughly ₪4,800 per month, which at 5% annual interest over 25 years services a loan of about ₪820,000 on a Spitzer schedule. The actual amount depends on the interest rate, the loan term, and the bank's policy.
On a ₪1,200,000 mortgage over 25 years, moving from 4% to 5% interest raises the monthly payment from about ₪6,334 to about ₪7,015 — an extra ₪681 per month. Over the full term, that adds up to roughly ₪204,000. The larger the loan and the longer the term, the bigger the impact of each percentage point.
This calculation is a general estimate for illustration only. It does not constitute tax, pension, or investment advice, nor a substitute for personal advice from a licensed professional, and should not be relied on for decisions.
