Landlords Skipping Tenant Deposits Surge... "July 55.4 Billion KRW Record High"

[Image source=Yonhap News]

The number of tenants who fail to recover their jeonse deposit from landlords is steadily increasing.

According to the Housing and Urban Guarantee Corporation (HUG) on the 16th, the amount (number of cases) of jeonse deposit return guarantee insurance claims was recorded at 55.4 billion won (259 cases) last month. Both the amount and the number of cases are the highest ever on a monthly basis.

The jeonse deposit return guarantee insurance product was first launched in September 2013. Currently, it is handled by HUG, the Korea Housing Finance Corporation (HF), and the private guarantee institution SGI Seoul Guarantee.

When tenants subscribe to the jeonse deposit return guarantee insurance, if they fail to receive their jeonse deposit from the landlord after the contract period expires, these institutions will pay the deposit (subrogation payment). The institutions later exercise their right of recourse to claim from the landlord.

The amount of jeonse deposit claims has been continuously increasing. According to HUG statistics, it surged from 3.4 billion won in 2016 to 7.4 billion won in 2017, 79.2 billion won in 2018, 344.2 billion won in 2019, and 468.2 billion won last year. This year, it has already reached a staggering 306.6 billion won over seven months.

This indicates that the number of landlords who do not return the jeonse deposit to tenants is increasing accordingly.

The amount of subrogation payments made by HUG on behalf of landlords also sharply increased from 2.6 billion won in 2016, 3.4 billion won in 2017, 58.3 billion won in 2018, 283.6 billion won in 2019, to 441.5 billion won last year. This year, the cumulative amount over seven months has reached 261.1 billion won.

The significant increase in claim amounts is largely attributed to malicious landlords.

According to data on the "Ranking of landlords with multiple jeonse deposit return guarantee insurance claims" by Kim Sang-hoon, a member of the National Assembly Land, Infrastructure and Transport Committee (People Power Party), landlord Lee Mo failed to return jeonse deposits totaling 57.44 billion won to 283 tenants. There are seven landlords with claim amounts exceeding 10 billion won.

Among the top 31 malicious landlords with many claim cases, there are 15 cases where HUG paid the jeonse deposit on behalf of the landlord but failed to recover the repayment or had a recovery rate in the 0% range.

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