HF Cuts Rates on Student Loans

- A 2.9% annual rate reduces interest burden by 60%

Korea Housing Finance Corporation (HF, CEO Choi Joon-Woo) announced on July 27, 2022, that it will lower the annual interest rate on student loans* to 2.9%. 

* HF offered student loans from July 2005 to May 2009 and is currently managing the loans extended during that period through entrusting 14 commercial banks to handle principal and interest payments. 

The rate cut will benefit some 18,000 consumers who took out HF student loans during that period, and HF plans to offer the reduced rate to student loan borrowers across the board without any separate application process.

The rate cut will take effect on July 28, 2022, and be applied for the first interest payment due after the completion of the ongoing IT development project at each lending institution*. As interest rate calculation varies by lender and interest payment date, student loan borrowers are asked to contact their lender or HF at the HF Customer Call Center (1688-8114) or its official webpage (www.hf.go.kr) for more information. 

* Please note that the IT development project schedule differs among the commercial banks (but all will be completed by the end of this August).

An HF official said, “The cut will lower the existing annual interest rate from 7.2% to 2.9%, easing the interest rate burden by some 60%. HF will remain proactive in improving our systems to enhance the rights and interests of financial consumers.”

As part of its efforts to reduce the interest burden for about 300,000 student loan users, HF lowered the annual rate to 2.9% in 2014 and 2020 in partnership with Korea Student Aid Foundation.