This text is an automatic translation from Русский. It was generated by AI and may contain inaccuracies.
Read original →
This text is an automatic translation from Русский. It was generated by AI and may contain inaccuracies.
Read original →Applications for mortgage restructuring surged 1.6-fold over the first 9 months of 2025. We examine the drivers: expiring grace periods, rates climbing to 27-30%, and why banks are willing to work with borrowers.
In the fall of 2025, Russia's mortgage market is showing a persistent trend: more and more borrowers are approaching banks to request changes to the terms of their existing loans. From January through September, residents of the Central Federal Districtsubmitted37,900 applications for mortgage loan restructuring—1.6 times more than during the same period in 2024.
Restructuring is a procedure in which a bank modifies the terms of an existing loan agreement to reduce the financial burden on the borrower. Typically, this happens when someone faces temporary difficulties: income has dropped, a job has been lost, or unexpected expenses have emerged. The main goal is to make debt servicing manageable.
Restructuring allows borrowers to:
Moscow and the Moscow region account for 57% of all applications—21,600 requests, reflecting the concentration of credit burden in the country's largest region. During the same period, banks approved 11,600 applications totaling 56.8 billion rubles, nearly double last year's figure.
At the same time, the share of problem loans is also growing. According to the regulator's estimates, by August 2025, overdue mortgage debt reached 0.81% (the highest level in the past five years). Given that the total volume of all issued and outstanding mortgage loans in the country has already reached 22.6 trillion rubles, such changes are becoming a notable signal of systemic market restructuring.
The market is now experiencing the delayed effects of late 2024, when the key rate stood at 21%. At that time, market-rate mortgages effectively moved into the 27–30% range, making conventional loans virtually inaccessible. To avoid losing sales, developers partnered with banks to massively roll out installment programs (developer-subsidized mortgages). Banks issued loans at ultra-low rates (0.01%, 0.1%, or 1%). The difference between this preferential rate and the actual market rate was compensated to the bank by the developer itself, which paid the bank a commission (discount). The key catch: the preferential rate only applied for a limited period, after which market conditions kicked in. People were lured in with promises that rates would drop to comfortable levels during this period—but that didn't happen. By fall 2025, the key rate did indeed come down, but only to 16.5%, which provides significant relief to borrowers but is still too high to dramatically reduce mortgage costs. As a result, market rates remain elevated, and borrowers whose year of preferential payments is expiring are suddenly confronting the real cost of their loans.
For those who took out "0.01%" installment plans a year ago, payments calculated at 27–30% rates are now starting to arrive. And it's precisely this category of borrowers that makes up a significant portion of new restructuring requests. Against the backdrop of rising household expenses and inflationary pressure, mortgage payments are becoming the primary budget risk.
First, restructuring allows banks to keep loans in performing status. This is fundamentally important for banks: a loan where the client is at least partially meeting obligations is better than a formal default, which immediately requires provisioning and impacts financial metrics.
Second, the cost of delinquency is higher for banks than the cost of deferral. Mortgages are long-term products, and moving even a small portion of the portfolio into non-performing loans creates sharp pressure on capital. Restructuring provides an opportunity to "spread out" risks over a longer period without booking losses here and now.
Third, banks understand the profile of current borrowers well. A significant portion of those requesting modified terms are conscientious payers caught under rate pressure. Their long-term ability to pay remains intact, but the immediate burden has become too high. With such clients, it's more economically advantageous to work things out than to push the situation toward default.
The mortgage lending market is one of the key sectors for banking. Maintaining its stability is a strategic priority. Therefore, restructuring serves as a portfolio stabilization tool, allowing banks to navigate through a period of high rate volatility without sharp spikes in delinquency. That's precisely why in 2025 banks are readily accepting requests to revise payment schedules, extending loan terms, and offering soft forms of deferrals: in conditions where household solvency is under pressure, restructuring becomes not just a tool for helping borrowers, but a mechanism for reducing systemic risks across the entire market.
For many borrowers, modifying loan terms is becoming not an optimization opportunity, but a tool for preventing default. Banks, in turn, are actively accommodating these requests—not so much out of loyalty as from a calculation to preserve portfolio quality and avoid a wave of delinquencies.
The surge in requests to modify mortgage terms is one of the most sensitive markers of the current economic situation. Mortgages, until recently considered a stable financial instrument, are turning into a subject of negotiation between borrowers and banks.
Over the next two years, it will be precisely the flexibility of lenders, the caution of borrowers, and the balanced policies of regulators that determine the future of Russian mortgages—and their ability to weather a period of high turbulence without systemic losses.