The Bank of Israel announces its interest rate several times a year. On October 21, 2026 it decided to leave the rate unchanged at 3.25%, after a 0.25% cut in September. Each such decision has a direct or indirect effect on your mortgage.
Direct effect: the prime track
Prime = the Bank of Israel rate + 1.5%. A 0.25% change in the rate changes the prime payment as early as the following month. The prime track
Example: NIS 600,000 in prime for 25 years. A 0.25% cut lowers the payment by about NIS 80–90 a month. A 1% rise adds about NIS 330–350.
Indirect effect: new tracks
The rates banks offer for fixed and variable tracks are affected by market expectations for interest and inflation. When the market expects rate cuts, fixed rates sometimes fall too, even before the decision itself.
What does not change?
- Fixed non-linked and fixed linked – the rate set at signing stays.
- Variable every 5 years – changes only at the reset point, according to the anchor on that day.
What should you do?
- When rates fall – it can be a good time to check refinancing, especially if you have fixed tracks at a high rate.
- When rates rise – check whether your prime share is still comfortable, and consider moving part of it to a fixed track. Refinancing when rates rise
Current figures: rates and indices (in Hebrew).