Mortgage in Japan.

[vapid]

I am curious if there are HELOC (home equity line of credit) or the equivalent here in Japan? Considering the low rates in Japan, if a HELOC exists, that would be a useful vehicle for investment purposes.

[RetireJapan]

I don't think so. You can get general purpose loans but investing is specifically excluded and the interest rates are quite a bit higher.

I took at look at one scheme a while back: http://www.retirejapan.info/blog/other-peoples-money

[StockBeard]

My question is which banks are the most foreign friendly when it comes to mortgages?
Should we have substantial savings with the same bank before applying for a mortgage or does this matter?

In my recent experience:
The fact that you are a foreigner or not does not (officially) matter. If you have Permanent Residence, you are entitled to the same service and rights as Japanese people. I have not encountered visible "anti foreigner" policies in my research. (Note that my wife is Japanese so this might have helped, but everything is done in my name as she doesn't have any income)

However not having permanent residence has proven to be a problem. Banks that have been willing to consider my application, without permanent residence: MUFG, SMBC, and Shinsei. Mizuho were willing to consider it if I gave them the paperwork proving I was applying for permanent residence. However they changed their mind upon learning I haven't been back in Japan for more than a year yet (the fact that I've lived here for 11 years in aggregate does not seem to matter).
Many friends I know without permanent residence have gone with SMBC and have been satisfied with them.

Other banks/institutions, in particular the ones with great rates (SBI comes to mind) explicitly rejected applications for non permanent residence visa owners.

In my experience, having a bank account (or not) with the financial institution prior to asking for the loan does not seem to help one way or the other. Let alone having lots of money on that account: I have all my money at Shinsei and it did not seem to help in any way. All it does is that it means I wouldn't have to open yet another account to transfer the money if I went through them (that part is not even true for all banks: I have owned an account at MUFG for 10 years, but they still asked me to open a new one, in a different branch, just for applying for a loan. Before I even know if they'll accept or not...)

[Tomthumb16]

Thank you for clearing that up.
I'm still about 18 months away from being eligible to apply for PR so plenty of time left to research the right bank for us.
Also hopefully the retirejapan guide to mortgages will be out by then!! D

[RetireJapan]

Also hopefully the retirejapan guide to mortgages will be out by then!! D

Ha, ha, ha.

You'd think so, wouldn't you???

[ricardo]

Stable income is the key thing.

Warning: if you’re a director or contractor they will look at your taxable income. For many such people this is much lower than their gross income. I earn ¥7 million a year but my taxable pay is ¥3m - and this is what they used to determine how much they would lend me. As I had a substantial deposit I didn’t want to borrow that much but it’s worh bearing in mind and getting checked early in the process