Despite the growing importance of financial lending in homeownership acquisition in urban China, the differing uses of financial instruments across home buyers have rarely been examined. This study reveals the temporal dynamics of financial instruments used to fund home purchases since 1998 and the factors influencing buyers’ different use of commercial mortgages, Housing Provident Fund (HPF) loans, and combined mortgages. Using the 2017 China Households Finance Survey, we demonstrate that financial loans, and commercial mortgages in particular, have become increasingly important for home purchases since the early 2000s. Multi-level logistic regressions are employed to investigate factors affecting people’s use of mortgages. The results demonstrate that people with higher educational attainment are purchasing dwellings with higher prices and in more recent years are more likely to use mortgages. When differentiating the type of mortgages, it is found that rural locals and migrant workers generally rely on commercial mortgages, whereas urban locals and those working in the public sector are more likely to take advantage of preferential-rate HPF loans. These findings suggest that vulnerable groups are provided with fewer financial avenues in this increasingly financialised era. The consequence of inequality in housing finance utilisation in the process of asset accumulation deserves further examination.