Lenders in several key markets are growing more cautious about mortgage applications for completed homes, with a rising share facing rejection in recent months. A recent report drawn from data shared by Etazhi highlights how many borrowers are finding it harder to secure financing as the lending climate becomes more conservative.
Experts point to mounting borrower debt as the primary factor driving tighter conditions. The buying environment has become more restrictive across the board, with little sign of quick relief, according to Tatyana Reshetnikova, head of the mortgage division at Etazhi. Her assessment suggests a broader retrenchment among lenders that extends beyond individual credit checks to a comprehensive view of an applicant’s overall financial picture.
Reshetnikova notes that approval rates in the secondary market declined from 60.4 percent in December 2023 to 52.8 percent in April 2024. Similar declines appeared in the primary market, where approved applications dropped from 65.7 percent to 61.9 percent in the same period. The shift means more hopeful buyers are turned away even when they appear to meet basic criteria, underscoring a risk-averse lending environment.
She adds that the risk of rejection rises for individuals who carry credit cards, even if those cards have not seen recent activity. Banks now weigh all potential costs for borrowers, including installment plans, mandatory payments, and even loans that have been approved but not yet disbursed. This broadened calculation can tilt decisions against applicants who might otherwise seem eligible on a narrow review.
Moreover, a borrower can be rejected even after receiving approvals from multiple banks. Conversely, a surge in rejections within a short window can trigger additional scrutiny and later rejections. This creates a frustrating loop for applicants trying to gauge true borrowing capacity and plan their housing strategies.
Reshetnikova urges borrowers to monitor their credit history regularly and ensure that up-to-date information about repaid and closed loans is accurately reflected. Before applying for a mortgage, she suggests clearing any outstanding loans with late payments or restructurings, checking for court-related debts, and evaluating the share of mandatory payments relative to the prospective mortgage burden.
She notes that some banks still permit debt loads amounting to 70–80 percent of a borrower’s real income, but such high thresholds substantially increase the chance of rejection. The takeaway is clear: a solid debt-to-income profile matters, and borrowers should anticipate a careful, multi-bank evaluation rather than a straightforward approval path.
Historically, buyers tended to focus on the property’s quality rather than loan terms when weighing mortgage opportunities. The current climate shifts emphasis toward a more holistic view of financial health, where overall debt levels determine eligibility and pricing. This change affects buyers across different markets and property types, whether they are considering existing housing or new builds.
Looking ahead, industry analysts suggest rate reductions are unlikely to arrive quickly, given the ongoing tightening of lending standards and cautious risk assessments by lenders. The practical implication for prospective buyers is to build a clearer, more robust financial profile, plan for higher upfront costs, and consider longer repayment horizons to keep housing affordable even as interest rates fluctuate.