Mortgage loan bank – how is it different from a traditional bank?

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When looking for any loan, be it a cash loan or a car loan, we most often browse the websites of banks or compare national rankings.

People who do not have satisfactory creditworthiness decide to use the services of loan companies and take out the so-called Good Finance.

Regardless of whose services we ultimately use, the traditional bank has always been in line with credit, so if we are on the threshold of buying our own apartment, we are thinking about going there for a mortgage.

Meanwhile, there are also alternative options on the financial market, and one of them is the mortgage bank. What is a mortgage bank and how is it different from a traditional bank?

Mortgage Bank Definition


A mortgage bank is a financial institution that operates as a joint-stock company. The main purpose of its activity is to grant loans that have been secured with a mortgage and to issue mortgage or public mortgage bonds.

In addition, mortgage bank services are used by entities with high creditworthiness, such as the State Treasury or the Capital Lender.

What regulations govern the operation of mortgage banks in Poland?


The detailed activity of mortgage banks was regulated by the Act of 29 August 1997 on mortgage bonds and banks. Supervision over these institutions is exercised by the Good Finance Investment Corporation, which operates through the so-called trustee who is appointed once every six years.

Mortgage Bank Act

Pursuant to the Act, in order for a mortgage bank to function on the financial market, the name “mortgage bank” must be included in the name of the institution.

What functions does the mortgage bank perform?


The basic tasks of a mortgage bank include primarily:

  1. Mortgage-secured loans;
  2. Granting loans that are not secured by a mortgage, but have a guarantee or a surety by the Capital Lender, the European Central Bank, governments or central banks of the Member States of the European Union and the Organization for Economic Cooperation and Development. The exception is those countries that are currently restructuring or restructuring their foreign debt in the last 5 years.
  3. Purchase of other banks’ claims arising from loans secured and unsecured by a mortgage;
  4. Issue of mortgage and public mortgage bonds.

What is the difference between a mortgage bank and a traditional bank?


There are only a few mortgage banks in Poland and although in the context of mortgage loans they are an alternative to a traditional bank, it is still a little known institution. Below are some significant differences that exist between the two institutions.

How does a mortgage bank calculate its creditworthiness?

A mortgage bank assesses the customer’s creditworthiness on the same basis as a traditional bank. Therefore, it takes into account the amount and regularity of income, the source of their origin (employment contract, commission contract, etc.), credit history in BIK, the age of the future borrower, the number of people who are dependent on him or marital status.

Are there significant differences in mortgage loans?

Mortgage banks operate on the basis of the Act on mortgage bonds and banks, which is why the requirements they impose are much more stringent than those specified by traditional banks. A person who wants to apply for a mortgage bank must meet the following conditions:

  • own contribution of 20% (some traditional banks allow a contribution of 10%);
  • buy an apartment that is already built, because mortgage banks do not finance so-called holes in the ground (some traditional banks grant a mortgage on the basis of e.g. a construction plan);
  • prepare for a rigid property valuation framework, because mortgage banks use the traditional valuation method, where the potential value of the property in several years is taken into account.

Mortgage banks often operate by their creators (e.g. Good Finance mortgage bank, works by Good Finance bank), therefore it may happen that a person applying for a loan to a traditional bank and meeting all stringent requirements will be offered a loan from a mortgage bank.

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