What Is the Katz Track (קל"צ) in an Israeli Mortgage?

The Katz track (קל"צ — short for Kavua Lo Tzmooda, "fixed, not linked") is the closest equivalent to a Western fixed-rate mortgage. The interest rate is fixed for the life of that loan segment and is not linked to inflation, so the payment is fully predictable from day one.

Because the bank absorbs the inflation and rate risk, Katz rates are typically the highest of the three main Israeli mortgage tracks at signing. It is particularly attractive when inflation is high, since your debt does not grow with the Consumer Price Index the way a CPI-linked track's would.

Why it matters for a buyer: for overseas buyers earning income in foreign currency, Katz offers full payment certainty with no inflation surprise. Many advisers recommend allocating a meaningful share of an Israeli mortgage to Katz as a hedge, even though the headline rate is higher.

Source: Bank of Israel mortgage track regulations; Israeli Banking Supervision Department