This file photo shows a real estate project in Hangzhou, capital of east China's Zhejiang Province. [Photo/Xinhua]

China's financial watchdogs announced Thursday that housing credit policies will be adjusted and optimized.

The interest rates of existing mortgages for first-home purchases will be lowered, according to a joint statement released by the People's Bank of China and the National Administration of Financial Regulation.

Starting from Sept. 25, borrowers of existing mortgages for first-home purchases can seek to lower their interest rates by applying for a rate change in the contract or a swap for a new mortgage.

The move is expected to reduce interest expense for mortgage borrowers and help spur consumption and investment. The banking sector might also see an ease in paying back mortgages in advance, which will boost their interest revenue, the two financial watchdogs said.

Banks and mortgage borrowers will be guided to negotiate independently according to market-based principles and rule of law to reduce the interest rate of existing housing loans in an orderly manner and maintain the market competition order, they added.

The country will also implement a uniform policy on the minimum down payment ratio for individuals' commercial housing mortgages both for first-home and second-home purchases, another statement said.

The minimum down payment ratio for individuals' commercial housing mortgages for first-home and second-home purchases will be adjusted to be no lower than 20 percent and 30 percent, respectively, nationwide.

In line with the above changes, local governments can change related housing credit policies in a city-specific manner, according to the statement.

The adjustments in housing credit policies echoed the call from the Communist Party of China leadership and the Chinese government, which in July urged the roll-out of optimized real estate market policies to adapt to the major changes in the market and meet different demands.

Many Chinese cities have recently announced changes in housing credit policies, such as allowing home buyers to enjoy preferential loans for first-home purchases regardless of their previous credit record.