Song Young-gil: "LTV 90%, Discussed During Primary, But Will Be Adjusted Through Government Consultation"

[Image source=Yonhap News]

[Asia Economy Reporter Koo Chae-eun] Song Young-gil, leader of the Democratic Party of Korea, said on the 18th regarding the easing of the loan-to-value ratio (LTV) to 90% for home mortgage loans for non-homeowners with actual demand, "During the primary election, we talked about up to 90%, but it will be adjusted during consultations with the government."

Song said, "The government side also agrees on adjusting the LTV as a measure for actual demand, although not up to 90%, so the specific figures will be decided through consultations between the Real Estate Special Committee and the government."

On the same day, Song met with reporters at the Gwangju 5·18 Memorial Culture Center and said, "The LTV for speculative areas, adjusted areas, and general areas is 40%, 50%, and 60%, respectively, but there is discussion about partially adjusting it for actual demand."

Separately from the LTV issue, Song mentioned the ongoing 'Nuguna Jip Project' in Incheon, saying, "We are consulting with the Ministry of Land, Infrastructure and Transport to further evolve and develop this project into a structure where you can buy your own home with only 6% of the house price in cash."

He continued, "The SPC (Special Purpose Company) promoting the Nuguna Jip Project raises 50% of funds through long-term mortgages, 10% is invested by the construction company, 10% is reinvested from development profits through the project, and of the remaining 30%, 24% is financed through jeonse deposit mortgage loans, making it possible to buy a home with 6% cash. We are concretizing this structure significantly."

He added, "When we say we will ease the LTV, some say 'Are you buying a house with debt?' but whether you pay monthly rent, jeonse deposit interest, or interest on borrowed money to buy a house, you are paying housing costs in some form. The core of the Nuguna Jip Project is to eliminate this discriminatory structure and present a new alternative for housing."