Chairman Kim Juhyun: "Relax LTV to 50% for Non-Homeowners... Allow Mortgage Loans Over 1.5 Billion Won"

[Image source=Yonhap News]

[Asia Economy Reporters Song Hwajeong and Song Seungseop] The loan-to-value ratio (LTV) for mortgage loans for non-homeowners and one-homeowners has been eased to 50%, and mortgage loans will be allowed for apartments exceeding 1.5 billion KRW.

On the 27th, Kim Joo-hyun, Chairman of the Financial Services Commission, announced this at the 11th Emergency Economic and Livelihood Meeting presided over by President Yoon Seok-yeol at the Presidential Office. Regarding the easing of real estate financial regulations, Chairman Kim said, "There are many concerns about the soft landing of the real estate market recently, and it is an important issue for financial market stability as well," adding, "Regulations have actually been strict so far."

Chairman Kim stated, "With recent interest rate hikes and changes in policy conditions, we will boldly ease one regulation," adding, "For non-homeowners and one-homeowners, LTV will be allowed up to 50% even in speculative areas." Currently, the LTV for non-homeowners and one-homeowners is 70% in non-regulated areas and 20-50% in regulated areas.

Earlier, the government had eased the LTV cap to 80% for households purchasing their first home starting in August.

Mortgage loans will also be allowed for apartments exceeding 1.5 billion KRW. Currently, mortgage loans are prohibited for apartments exceeding 1.5 billion KRW in speculative and overheated districts.

Chairman Kim said, "We will allow mortgage loans exceeding 1.5 billion KRW," adding, "We will coordinate with the Ministry of Land, Infrastructure and Transport to ease regulations where necessary and stabilize the market."

In addition, Chairman Kim emphasized, "To support shipbuilding orders, we are preparing to issue refund guarantees (RG) worth 2.5 billion USD each for two large shipbuilding companies," adding, "For small and medium-sized shipbuilders, we will ensure through policy finance that there are no difficulties in receiving orders due to RG issues."

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