If You Cancel Your Housing Pension Within 3 Years, Initial Guarantee Fee Refund Ranges from 8.9% to 100%

Effective from the 12th... 100% Refund Within 30 Days
Re-enrollment Not Allowed for 3 Years After Cancellation

[Asia Economy Reporter Minwoo Lee] If you cancel your housing pension within three years of enrollment, you will be able to receive a refund of the initial guarantee fee.

Korea Housing Finance Corporation announced on the 7th that it will apply this guarantee fee refund policy starting from the 12th.

The initial guarantee fee for the housing pension is set at 1.5% of the housing price (1.0% for loan repayment method) when first enrolling in the housing pension. Currently, the initial guarantee fee paid once is not refunded in principle even if the housing pension is canceled, but from the 12th, if the subscriber cancels the housing pension within three years from the initial loan execution date, a portion of the initial guarantee fee will be refunded. For existing subscribers, those who have used the service within three years of enrollment are eligible, and for new subscribers, only cancellations within three years apply.

The refund amount is calculated in a way that gradually decreases as the usage days increase. It varies depending on the initial guarantee fee paid by the customer and the pension usage period. For example, if a housing pension with a housing price of 500 million KRW and lifetime payment method is canceled one year after enrollment, about 5.14 million KRW out of the 7.5 million KRW (1.5% of the housing price) initial guarantee fee already paid can be refunded.

However, if the housing pension is canceled early, ▲ re-enrollment in the same house is restricted for three years ▲ financial costs such as stamp tax may increase upon re-enrollment.

Choi Jun-woo, president of Korea Housing Finance Corporation, emphasized, "With this system improvement, we hope that customers who hesitated to enroll due to the burden of the initial guarantee fee will be able to use the housing pension more conveniently," and added, "We will continue to promote improvements to the housing pension system by reflecting customers' voices."