FSC Denies Rumors of Mortgage Disbursement Delays Until 2027, Confirms Normal Operations

Recently, Taiwan's real estate market has continued to be affected by tight market capital and banks' aggregate credit controls on real estate, with frequent reports from the public regarding prolonged review periods and slower disbursement speeds when applying for mortgages. Recently, some real estate agency operators even reported that certain banks require waiting anywhere from one to three months for mortgage disbursements, triggering high concern among homebuyers and the market. In response to external concerns that the mortgage market might fall into severe gridlock, the Financial Supervisory Commission (FSC) specifically explained that, after understanding and investigating through relevant financial institutions, banks' mortgage businesses are generally still maintaining normal acceptance overall. There is no occurrence of rumors circulating in the market such as the suspension of accepting applications, malicious delays in disbursement, or the extreme scenario of having to wait for disbursements until 2027.

The FSC further elaborated on practical operations, pointing out that the recent perception among the public or real estate agencies that mortgage review and disbursement speeds have slowed down is closely related to the capital allocation of individual banks, internal credit risk controls, and regulatory limits on real estate lending ratios. When underwriting mortgage businesses, banks must comply with Article 72-2 of the Banking Act, which stipulates that the total amount of residential and enterprise building loans handled by commercial banks shall not exceed a certain percentage of the total deposit balance and the financial bonds issued. Under the backdrop of a tightening overall market capital environment, most banks' mortgage lending quotas have approached internal warning thresholds, forcing them to be more cautious and stringent when reviewing cases, which naturally lengthens the overall operational timeline from application submission, review, to loan signing and disbursement.

In addition to internal bank controls and regulatory restrictions, the FSC also pointed out the underlying reasons for the discrepancies seen in the actual loan application process for certain individual cases. The delays in housing handovers and disbursement queues perceived by some homebuyers and real estate agents are not simply caused by banks rejecting loans or intentionally delaying them; rather, they are closely linked to the operational scheduling and handover timetables of the developers themselves. When facing macroeconomic challenges such as rising raw material costs and shortages of labor and materials, some developers may experience delayed construction progress, which in turn affects the subsequent overall handover schedule. Meanwhile, homebuyers' own financial planning, personal credit scores, and the speed of submitting supplemental documents will also directly affect the efficiency of banks in reviewing cases. It is the intertwining of these factors that has created the public impression of a massive traffic jam in the mortgage market.

From the perspective of the macro real estate and financial markets, the wave of mortgage disbursement queues and the phenomenon of tight capital reflect the policy trajectory through which regulatory authorities have continuously guided the real estate market toward sound development in recent years. To prevent excessive capital from flowing into the real estate market, triggering asset bubble risks and crowding out the capital demands of the real estate sector, the central bank and the FSC have worked in tandem, successfully achieving the effect of cooling down the housing market through the implementation of credit controls and the strengthening of banks' real estate credit risk management. However, such a policy shift has also caused a substantial impact in practical execution on ordinary homebuyers with rigid demand. Particularly, first-time homebuyers and owner-occupiers often have to bear greater financial pressure and default risks when facing variables such as stricter bank reviews and prolonged disbursement timelines.

For citizens preparing to enter the housing market and real estate industry players, facing the new normal where banks' mortgage businesses continue to maintain normal acceptance but review and disbursement timelines are generally prolonged, corresponding financial and property handover strategies must be adjusted. When signing buying and selling contracts, homebuyers should reserve more generous timeframes for mortgage applications and disbursements to avoid facing default penalties due to untimely bank operations. At the same time, complete financial proof documents should be prepared when submitting applications, and homebuyers should proactively communicate with their cooperating banks to mitigate the shocks brought by uncertainties in the review process. Regulatory authorities will also continue to closely monitor the capital flows of the banking industry and the handling of mortgage businesses to ensure financial stability while taking into account the public's normal housing financing needs.

(Source Fact: Central News Agency)