HF launches public mortgages with 50-year maturity

- Expands options for Bogeumjari and conforming loan customers

Korea Housing Finance Corporation(HF, CEO Choi Joon Woo) announced on July 15 that Bogeumjari and conforming loans with 50-year maturity are set to be released on coming August 1. The launch is made in accordance with the “The New Administration’s Household Debt Management Plan & Step-by-Step Normalization of De-regulatory Measures”, announced on June 16 by the Financial Services Commission (FSC). 

HF expects that the release would offer more choices to mortgage loan customers, while alleviating monthly repayment burden at the initial stage of loan period on youngs adults with relatively less income.

Those aged 34 or younger, or newlywed couples with seven years or less of marriage are eligible to take out the Bogeumjari and conforming loans with 50-year maturity, of which redemption can be made through equal principal or equal P&I methods.

To relieve financial cost burdens on young adults, the interest rates for the products are set to be around the current interest rates of 40-year long mortgages, whereas the rates of existing 40-year long mortgages will be lowered by around 0.02%p.  

* Interest rate decrease example: July U-Bogeumjari Loan interest rates : (current) ▲30-year maturity: 4.8%, ▲40-year 4.85% → (afterward) ▲30-year maturity 4.8%, ▲40-year maturity 4.83%, and ▲50-year maturity: 4.85%

In case of customers who take out 50-year public mortgages worth of KRW 300M, annual P&I repayment burden will be reduced by KRW 960,000, compared to that of 40-year maturity.

HF said,”The 40-year maturity products we launched in July last year now accounts for 18% of the total Bogeumjari loans, as of the end of June, and have forayed into non-banking financial sectors as well as banking sectors. We will step up our efforts to support the low-to-moderate income households and end-users in line with the government’s policy to stabilize their livelihood. “