Housing Finance Corporation Increases Guarantee Support 2.5 Times This Year for Financially Vulnerable Groups Amid 'Corona Cold Wave'

Expansion of Jeonse Deposit Support... Significant Increase to 9.2 Trillion Won from 3.7 Trillion Won Last Year

Status of Guarantee Support for Financially Vulnerable Groups by the Korea Housing Finance Corporation.

[Asia Economy Yeongnam Reporting Headquarters Reporter Kim Yong-woo] Korea Housing Finance Corporation (HF, President Lee Jeong-hwan) announced on the 15th that it supplied 9.2 trillion KRW in jeonse loan guarantees to financially vulnerable groups until November this year, reducing their annual housing cost burden by 64.7 billion KRW.

HF expanded the supply limit of youth jeonse and monthly rent guarantees from 1.1 trillion KRW to 4.1 trillion KRW to support vulnerable groups whose livelihoods have been affected by COVID-19. It also expanded agreements with local governments and financial institutions to provide support for loan interest rate reductions and preferential guarantee fee policies.

As a result, HF guaranteed 9.2 trillion KRW until November this year, a 150% increase compared to the same period last year (3.7 trillion KRW).

Youth jeonse guarantees increased by 375% to 2.6 trillion KRW until November this year compared to the same period last year, supporting a total of 50,000 households.

Youth jeonse guarantees are products that support housing deposits up to 70 million KRW at an interest rate in the 2% range for young people under 34 years old without home ownership. It was found that job seekers and young workers with an annual income of 30 million KRW or less received jeonse loan guarantees of 50 million KRW per person.

The local government agreement jeonse guarantee product supported 3.4 trillion KRW for 30,000 households until November this year, a 147% increase compared to the same period last year. Newlyweds and youth received interest support from local governments and used jeonse guarantees of 130 million KRW at an average annual interest rate of 1.4%.

HF explained that through this, the monthly interest cost was reduced by 130,000 KRW compared to general jeonse guarantee users.

Jeonse loan guarantees through agreements with financial institutions supported 2.8 trillion KRW for 20,000 households until November this year, an 84% increase. This product is one where financial institutions partially reduce loan interest rates and HF offers preferential guarantee fees, mainly used by newlyweds and families with multiple children.

Additionally, special support jeonse guarantee products for credit recovery support recipients and policy low-income finance users supported 300 billion KRW for 5,000 households until November this year, a 21% increase compared to the same period last year.

An HF official said, “To support the reduction of housing costs for low-income groups struggling due to COVID-19 this year, we collaborated with local governments and financial institutions to provide 9.2 trillion KRW in jeonse guarantees, alleviating an annual interest burden of about 60 billion KRW and offering 4.7 billion KRW in preferential guarantee fees, reducing the total burden by 64.7 billion KRW.”

There are three main products through which the corporation collaborates with related organizations to ease the housing cost burden for vulnerable groups.

These include youth jeonse guarantees that offer a 0.3 to 0.6 percentage point preferential loan interest rate through agreements with 13 banks, local government agreement jeonse guarantees where local governments support loan interest rates by 1 to 2 percentage points, and financial institution agreement jeonse guarantees that provide a 0.1 to 0.2 percentage point preferential loan interest rate through agreements with individual financial institutions.

The corporation offers preferential guarantee fees at the minimum guarantee fee rate (0.05%) for these products.

This content was produced with the assistance of AI translation services.