After years of boom on the mortgage market, there was a sharp decline in the creditworthiness of Poles. High inflation and the resulting decisions of the Monetary Policy Council are behind this state of affairs.

Data from the Credit Information Bureau show that both the number and the value of loans granted by banks are going down. In the first months of this year, the market dropped by almost 40% compared to the previous year.


In Polish law, the term “creditworthiness” is defined as the ability to repay a loan and interest thereon within a specified period of time. Creditworthiness is the basic condition for obtaining a bank loan.

How do banks determine the customer’s creditworthiness?

Before granting a loan to a customer, the bank assesses their creditworthiness as it must be sure that the borrower will be able to repay the loan within the specified period of time. The analysis is carried out individually for each customer by employees of financial institutions who check the income situation.

There are two ways for checking the customer’s creditworthiness. The first one is the formal and legal capacity, which informs whether the customer has the capacity to conclude a valid contract. Banks may require to provide an identity document, employment and income certificates and, depending on the bank, other documents.

The other way is to determine the substantive ability. The bank assesses two aspects: economic and personal. The first aspect is designed to check the economic and financial situation and the ability of meeting loan collateral. In the personal aspect, it is trust in the borrower, i.e. family, property, professional experience and qualifications.

Why is creditworthiness declining?

The deteriorating inflation situation forced the Monetary Policy Council to raise interest rates, which translated into an increase in loan instalments with variable interest rates and a decrease in the creditworthiness of those who want to take out a loan. In addition, the Polish Financial Supervision Authority recommended that banks, when making decisions regarding mortgage loans, assume the possibility of another increase in interest rates.

What does the creditworthiness of an average Polish marriage look like now?

Assuming that the average Polish marriage earns a total of PLN 6,500 (around $1,500) net per month, has a 20% of own contribution and maintains one child, they could receive a loan of PLN 500,000 (around $113,000) in April 2021. Currently, the same family will receive less than PLN 200,000 (around $45,000). Thus, a drop of 300,000 ($67,800) is significant.

When will the mortgage market improve?

Specialists predict that the increase in salaries combined with lower real estate prices and the lack of interest rate increases may contribute to the improvement of the creditworthiness of Poles and greater sales of mortgage loans by banks. Nevertheless, the record-breaking situation of 2021 – when banks granted loans for almost PLN 90 billion (around $20,7 billion)– will not return any time soon.

Bartłomiej Haba