Up to 12 Years of Interest Support for Newlyweds with Two Children... Seoul Expands Rental Deposit Assistance

The Seoul Metropolitan Government is significantly expanding its "rental deposit interest support" program to enhance housing stability for newlyweds and young people. When newlywed couples have children, the loan term will be extended by an additional two years compared to the previous policy, and the eligibility criteria for young people will be eased to include monthly rents of up to 900,000 won, thereby broadening the scope of benefits.

On November 5, the city announced that the revised "Rental Deposit Interest Support Project for Newlyweds and Youth" will be applied to both new loan applicants and those seeking loan extensions starting from November 20.

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This program provides partial interest support from the city government for rental deposit loans taken out by newlywed couples or young people without homes residing in Seoul, through commercial banks that have agreements with the city.

According to the new policy, newlyweds who have one child will see the maximum extension period for their basic four-year loan increase from two years to four years. For example, if a couple has two children, in addition to the basic four-year loan, they will receive an extra four years for each child, totaling eight additional years, allowing them to use the loan for up to twelve years.

Support for households experiencing infertility has also been added. If proof of infertility treatment is submitted, the loan can be extended for two years. If a child is born during this extension period, the total loan period can reach up to ten years, combining two years for infertility, four years for the basic loan, and four years for childbirth.

In response to recent changes in the housing market, where the proportion of monthly rent is increasing, the eligibility criteria for newlyweds will also be relaxed. Previously, support was available for contracts with a rental deposit of up to 700 million won that included monthly rent. Going forward, eligibility will be determined based on a converted rental deposit calculated using the monthly rent-to-deposit conversion rate.

The converted rental deposit is calculated using the arithmetic average of Seoul's monthly rent-to-deposit conversion rates over the past six months and is updated every six months. The new "converted rental deposit" will reflect a conversion rate of 5.5 percent. This will apply to new loan recommendation applicants starting from November 20.

The threshold for youth support has also been significantly lowered. Previously, only homes with a rental deposit of up to 300 million won and monthly rent up to 700,000 won were eligible, but now homes with monthly rent up to 900,000 won will also qualify. The youth support program applies to young people without homes who are listed as the head of household on their resident registration and take out a rental deposit loan of up to 200 million won from Hana Bank.

Additionally, a new supplementary interest rate (1.0 percent) has been introduced for "self-reliant youth" who are transitioning to independent living after leaving protective facilities. Previously, only young people from single-parent families received the additional 1.0 percent interest support, but now self-reliant youth who submit a certificate of discharge from protection will receive the same benefit. With the basic interest rate of 2.0 percent plus the additional 1.0 percent, a total of 3.0 percent interest support will be provided.

Choi Jinseok, Director of Housing at the Seoul Metropolitan Government, stated, "Following the October 15 measures and the sharp rise in monthly and lump-sum rent prices, we will expand interest support for rental deposits so that newlyweds and young people can plan for their futures without worry."

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