Many people who have travelled to Bali end up wanting to buy a house on the island. Some may think that it's difficult but all it requires is the right paperwork!

Moving from their own homes and relocating to Bali has always been a financially sound decision for many. Formerly, it would be hard for somebody not native to the land to finance a mortgage and buy any kind of property here. The problem arose when the title of the real estate had the name of an Indonesian on it instead of the person trying to apply for the mortgage financing.

A foreigner cannot obtain a freehold title to a property in Bali, even if some real estate agents tell you otherwise. The name of one of the local nominees actually has to be on the property title. Unfortunately, this is the process that scares most Indonesian banks away from financing the mortgage.


Luckily, something called Hak Pakai Atas Hak Milik has been implemented in Bali, as well as in the rest of Indonesia. This new right of use above freehold land that has been implemented has allowed foreigners to be able to acquire land in Bali and other parts of Indonesia. Hak Pakai, or the right of use, is valid for as little as 25 years and can be pushed all the way to 100 years. People looking to move to the island should find this opportunity a lot easier in order to secure financing for a mortgage, because this allows a foreigner's name to be on the title deed.

Asia Property Finance Management, of APFM for short, is one of the companies that have a structure similar to this. This company was actually founded to help foreigners find a way to acquire property in Bali, as well as other parts of Indonesia. APFM has the ability to create an IPL, or an Indonesian Property Loan, which will allow them to offer an array of currencies for the mortgage and interest rates. Of course, they do this by partnering with an Indonesian bank.
Luxury Bali villa in Seminyak
IPL Features:

Supported currencies include: US Dollars, $AU, and IDR.

Loans can range from $12,000 up to $450,000.

60% of the property's valuation may be borrowed with a required deposit of 40%.

Maximum of 10 years for the loan and interest.

Variable interest rates, dependent on Cost Of Funds for the specific currency and a margin.

Are You Eligible?

If you are a foreigner living in Indonesia, you are eligible for an IPL upon bank approval.

Existing resident-based dwellings, such as a family home or an apartment will be the only properties considered.

Loan will be granted if the name of the title is the person applying for the loan, with a building permit attached.

Foreigners are only allowed to own a single Indonesian property, which means that foreigners can only apply for one property loan.

In addition to the above requirements, you have to meet the basics such as, showing that you will be able to afford rent, loan payments, and living expenses. Every loan applicant will be judged on their ability to handle the loan payments, which depends on the person's financial situation.

Currently The Commonwealth bank in Indonesia provides mortgage loans for foreigners as well. More information can be found at http://www.commbank.co.id/upublic/mod_home/default_content_2.aspx?code=comm_ipl#!.

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