Flat 35 mortgage lending rises 31 percent in April to June quarter
- Adam German
- 11 minutes ago
- 2 min read
Applications and lending under Japan’s Flat 35 fixed-rate mortgage program increased sharply in the April to June 2026 quarter, according to preliminary figures released by the Japan Housing Finance Agency on July 31st.
Applications totaled 14,900, up 14.6% year on year. Funded loans rose 24.3% to 9,634, while their combined value increased 31.4% to ¥324.9 billion.
The value of lending grew faster than the number of funded loans. However, the agency did not speculate on what drove the increase.
Flat 35 allows eligible homebuyers to fix their mortgage rate for up to 35 years. It is intended for homes occupied by the borrower or qualifying family members and cannot be used for investment properties.
Two Flat 35 lending structures
Flat 35 operates through a mortgage purchase program and a mortgage guarantee program.
Under the purchase program, a private lender originates an eligible mortgage and sells it to the Japan Housing Finance Agency. The agency then pools and securitizes the loans.
The borrower keeps ownership of the property and generally continues making repayments through the original lender.
Under the guarantee program, the lender retains the mortgage. The agency provides mortgage insurance against qualifying losses if the borrower defaults.
The two structures therefore serve different lender preferences: one allows the loan to be sold, while the other allows it to remain on the lender’s books.
Purchase program remains dominant
The purchase program recorded 12,546 applications, up 13.4% year on year.
Funded loans increased 20.6% to 8,156, while their combined value rose 25.3% to ¥269.1 billion.
Excluding refinancing, the program recorded 12,185 applications, 7,841 funded loans and ¥262.4 billion in lending.
The purchase program accounted for about 85% of funded Flat 35 loans during the quarter.
Guarantee program grows faster
The guarantee program recorded 2,354 applications, up 21.6%.
Funded loans climbed 50.2% to 1,478, while their combined value increased 71.8% to ¥55.8 billion.
Excluding refinancing, the program recorded 2,231 applications, 1,367 funded loans and ¥52.4 billion in lending.
The guarantee program represented about 15% of funded loans and 17% of lending value.
Its faster growth partly reflects its smaller base. In the same quarter of 2025, 984 guarantee-program loans were funded, compared with 6,765 purchase-program loans.
The figures suggest the guarantee structure increased its share of Flat 35 activity, but the agency did not explain the reasons for the change.
Funded-loan figures include mortgages applied for before April 2026. The figures are preliminary and may be revised.
Further Reading:
Flat 35: Official Program and Product Information (Japanese only)
