[2021 National Audit] 44% of Mortgage Loan Borrowers Are Double Debtors... Highest Since Statistics Began

[Asia Economy Reporter Kwangho Lee] More than 40% of the 10 people who took out mortgage loans were found to be dual debtors who already had credit loans or took out both loans simultaneously.

According to data submitted by the Bank of Korea to Yoon Chang-hyun, a member of the People Power Party on the National Assembly's Political Affairs Committee, the proportion of borrowers who simultaneously took out credit loans among new mortgage loan borrowers in the first quarter was 41.6%, based on the Bank of Korea's household debt database (DB).

This ratio is the highest level since the relevant statistics began in the second quarter of 2012.

In terms of loan amount, new mortgage loans taken out by borrowers who simultaneously took out credit loans accounted for 47.3% of all mortgage loans.

On a cumulative basis rather than just new mortgage loans, as of the end of the first quarter, 43.9% of all mortgage loan borrowers also had credit loans. The cumulative proportion (43.9%) is also a record high.

Conversely, among those who newly took out credit loans in the first quarter, 18.2%, and on a cumulative basis, 27.1% (34.7%) of credit loan borrowers already had or simultaneously took out mortgage loans.

There were also a considerable number of cases where both mortgage loans and jeonse deposit loans were taken out.

Among new mortgage loan borrowers in the first quarter, 8.8% had previously taken out jeonse deposit loans or took out both mortgage and jeonse deposit loans simultaneously.

In cumulative statistics, 2.5% of mortgage loan borrowers as of the end of the first quarter were dual debtors who also held jeonse deposit loans.

The proportion of dual borrowers of mortgage loans and jeonse deposit loans, both new and cumulative, was the highest since the statistics began in the fourth quarter of 2017.

Looking at the distribution of borrowers by mortgage loan amount, those with loans of 50 million won or less accounted for the largest share at 31.3%, followed by 50 million to 100 million won (26.6%), and 100 million to 200 million won (24.1%).

As of the first quarter, the proportion of borrowers whose total debt service ratio (DSR) exceeded 40% was 29.1% by number and 62.7% by loan amount.