50-Year Maturity Bogeumjari Loan and Qualified Loans to Launch Starting August

Annual Repayment Burden Reduced by 960,000 KRW for 300 Million Loan

[Asia Economy Reporter Minwoo Lee] The 50-year maturity Bogeumjari Loan and Qualified Loan will be launched starting next month. It is expected to ease the monthly repayment burden for young people whose initial income is relatively low.

Korea Housing Finance Corporation (HF) announced on the 15th that the 50-year maturity Bogeumjari Loan and Qualified Loan will be launched from the 1st of next month. This follows the Financial Services Commission's announcement on the 16th of last month regarding the "New Government Household Loan Management Direction and Gradual Normalization of Regulations."

The 50-year maturity Bogeumjari Loan and Qualified Loan are available to those aged 34 or younger or newlywed households within 7 years of marriage. Repayment can be made using either the equal principal or equal principal and interest method.

The loan interest rate will be set at the current 40-year maturity rate level to reduce the financial cost burden on young people. The existing 40-year maturity rate is expected to be decided at a level 0.02 percentage points lower than the current rate. For example, this month’s 'U-Bogeumjari Loan' rates are 4.8% for 30-year maturity and 4.85% for 40-year maturity, which will change to 4.8% for 30-year maturity, 4.83% for 40-year maturity, and 4.85% for 50-year maturity in the future.

For customers using the 50-year maturity policy mortgage product, borrowing 300 million KRW will reduce the annual principal and interest repayment burden by 960,000 KRW compared to the 40-year maturity. HF expects that this will expand the choices for mortgage loan customers and ease the monthly repayment burden for young people whose initial income is relatively low.

An HF official stated, "The 40-year maturity product introduced by the corporation in July last year accounts for 18% of all Bogeumjari Loans as of the end of June this year, and it is spreading not only in banks but also in the secondary financial sector," adding, "We will continue to actively respond to the government's livelihood stabilization policy and take the lead in supporting low-income and real demand borrowers."

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