Japan regulator steps up scrutiny of 50-year home loans
Japan's Financial Services Agency is increasing oversight of 50-year home loans offered by online banks. Regulators are concerned about the long-term repayment risks for borrowers if interest rates rise or incomes decline.
Why it matters
The rise of ultralong mortgages reflects housing affordability challenges and poses potential systemic risks to the financial sector.
Japan’s financial regulator is increasing scrutiny of ultralong mortgage lending by online banks and others as the country’s housing market booms, according to a Financial Services Agency official.Home loans of as long as 50 years are becoming more common among younger borrowers with modest incomes, because they allow smaller repayments to be stretched out over a longer time.
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