Housing Finance Corporation Lowers Barriers for Limited Liability Loans... Annual Income Up to 100 Million Won Allowed

[Asia Economy Yeongnam Reporting Headquarters Reporter Hwang Du-yeol] Korea Housing Finance Corporation (HF) is easing the eligibility requirements for the 'Limited Liability Bogeumjari Loan.'

The limited liability loan (Limited Liability Bogeumjari Loan) is a system that limits the borrower's repayment responsibility to the collateral housing in case of repayment difficulties, preventing additional repayment demands beyond the recovery amount from the disposal of the collateral housing.

The system alleviates the borrower's economic burden and serves as a minimum social safety net in times of economic crisis.

Previously, couples with a combined annual income exceeding 70 million KRW were not eligible for the Limited Liability Bogeumjari Loan, but going forward, newlyweds can use it with an annual income of up to 85 million KRW, and multi-child families can use it up to 100 million KRW depending on the number of children.

The usage amount per child is up to 80 million KRW for families with one child, 90 million KRW for families with two children, and up to 100 million KRW for families with three or more children.

The loan limit, which was uniformly applied up to 360 million KRW regardless of the number of children, will now allow multi-child families with three or more children to use up to 400 million KRW.

In addition to purchasing a home and repaying loans, the fund usage has been expanded to allow the Limited Liability Bogeumjari Loan to be used for returning rental deposits.

The corporation previously determined eligibility for the Limited Liability Bogeumjari Loan based on evaluation criteria such as the age of the collateral housing and household growth rate in the area, but from now on, for row houses, multi-family houses, and detached houses, the loan can be used regardless of the evaluation score.

The Limited Liability Bogeumjari Loan was launched in May 2018 to stabilize housing for low-income and actual demanders and support recovery, and since then, the system has been improved to allow temporary two-homeowners to use it under disposal conditions and for repayment purposes.

Up to 2021, a total of 25.8 trillion KRW has been supplied through the Limited Liability Bogeumjari Loan, and the annual handling ratio has significantly increased from 4.2% in 2018 to 48.1% in 2021.

President Choi Jun-woo said, “The easing of eligibility requirements for the Limited Liability Bogeumjari Loan reflects the corporation’s commitment to protecting financial consumers and practicing inclusive finance,” adding, “We hope that the system improvements will further strengthen the financial safety net of our society.”