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Finance

Jeonse loans should focus on vulnerable households; fees needed for large loans

Kim Iuck-hyun (김이억원), chairman of the Financial Services Commission, said he will reflect a range of views on property lending policy in measures to manage household debt and protect end-users. At a public forum in Seoul, experts urged differentiated rules, including limiting guaranteed jeonse loans to vulnerable households while expanding support for them. Others called for moving beyond uniform loan caps and imposing macroprudential fees on high-priced homes, multi-homeowners and large borrowers.

Finance

Internet-only banks to expand in-person services, allowing debt restructuring and corporate loan screening

South Korea will partly expand the scope of in-person services allowed for internet-only banks while keeping the principle of non-face-to-face operations. The Financial Services Commission approved measures to allow exceptions for consumer protection and inclusive finance, including debt restructuring support, corporate loan screening interviews, and checks for forged documents. It also allowed in-person verification tied to mortgage and jeonse loans, collateral inspections and certain administrative limits. The three internet-only banks must report plans in advance.

Finance

Dongtan, Giheung, Guri designated as regulated areas; mortgage LTV set at 40 percent

South Korea designates Dongtan in Hwaseong, Giheung in Yongin and the city of Guri as regulated areas, tightening housing-related lending rules. From July 1, the mortgage loan-to-value ratio in the areas falls to 40 percent from 70 percent under non-regulated standards, while some categories such as first-time home purchases and policy mortgages apply eased ratios. Jeonse loans, large credit loans and business loans for home purchases also face tighter limits.