Last Month's Jeonse Deposit of 108.9 Billion Won Not Returned by Landlord... Largest Monthly Amount

[Asia Economy Reporter Kim Min-young] The amount of damages caused by landlords failing to return the jeonse deposit to tenants reached an all-time high last month.

According to the Housing and Urban Guarantee Corporation (HUG) on the 12th, the amount and number of jeonse deposit return guarantee insurance claims last month were 108.9 billion KRW and 511 cases, respectively. These are the highest monthly figures ever recorded. It was the first time that the amount and number of jeonse deposit return guarantee claims exceeded 100 billion KRW and 500 cases, respectively.

The jeonse deposit return guarantee insurance product was first launched in September 2013. It is currently handled by public guarantee institutions such as HUG and the Korea Housing Finance Corporation (HF), as well as the private guarantee institution SGI Seoul Guarantee. If a landlord fails to return the jeonse deposit on time after the contract period expires, these institutions pay the deposit to the subscriber (tenant) on their behalf (subrogation payment) and later exercise their right of recourse to claim the amount from the landlord.

The amount of claims for this product has increased every year since HUG began compiling performance data in 2015. It rose from 3.4 billion KRW in 2016 to 7.4 billion KRW in 2017, 79.2 billion KRW in 2018, 344.2 billion KRW in 2019, 468.2 billion KRW in 2020, and surged to 579 billion KRW last year.

The amount of deposits HUG paid on behalf of tenants (subrogation payment amount) also reached a record high last month at 83 billion KRW (398 cases). This is about 1.5 times the previous record of 57 billion KRW in June.

As of the end of July, the number of "malicious landlords" (concentrated management multi-home debtors) who habitually fail to return deposits to tenants and are under management totaled 203 individuals and corporations. Since last year, HUG classifies jeonse deposit insurance debtors as malicious landlords if they have three or more subrogation cases and unrecovered amounts exceeding 200 million KRW.

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