[Tracking Jeonse Fraud Reality]② "No money in midwinter, couldn't even turn on the boiler"... Youth turned into hell by the 'Villa King'

1.14 Billion Won Jeonse Fraud by Villa King Kim Mo
Unable to Renew Guarantee Insurance, Burdened with Debt and Became a Defaulter
"Hope to Recover Credit at Least to Live with Hope"

[Asia Economy Reporter Kwak Minjae] "When I signed the jeonse contract, the landlord was a young couple. They said they put the jeonse up for rent to combine the houses as their children grew up. The registry was clean, and I even subscribed to the jeonse deposit insurance, so I never imagined I would fall victim to a jeonse scam. Two days ago, when I checked my KakaoBank credit score, it had dropped from 844 to 200. I just stared blankly at my phone, didn’t eat, and think I cried all day."

Due to a jeonse fraud, Mr. Lee was unable to recover his jeonse deposit and consequently could not repay his loan, causing his credit score to drop from 844 to 200.
[Photo by Mr. Lee]

Giving up studies and working hard to save a large sum... Became a defaulter after not getting the money back

Mr. Lee, who turned 24 this year, spoke in a trembling voice, seemingly anxious. He became a defaulter (formerly known as a credit delinquent) just three months after falling victim to a jeonse scam. He neither stopped working nor spent money extravagantly. He was scammed by Mr. Kim, the "Villa King," who owned 1,139 houses and villas and failed to return deposits before passing away last October. Unable to extend his jeonse loan, he eventually could not keep up with the increasing interest.

The total jeonse deposit he could not recover was 114 million KRW. Three years ago, he signed a jeonse contract for a 5-story villa in Sungui-dong, Michuhol-gu, Incheon. He took out a 'Youth Employment Jeonse Deposit Loan for SMEs' for 100 million KRW, and the remaining 14 million KRW was money he saved diligently over two years through installment savings. Coming from a financially difficult family, he gave up on attending university early and got a job as an accountant at a small company. "My father works part-time at a bowling alley. We live with my grandfather, so I found it hard to ask for help and decided to get a job quickly. When my savings matured and I had a lump sum, I went to a real estate agency with high hopes."

Less than a week after signing the jeonse contract, he received an alert that the landlord had changed to a corporation. "I called the bank to ask if I needed to take any action because the landlord changed, but they said the jeonse contract would be automatically transferred, so I felt reassured. Moreover, a few months after the contract, when the toilet broke and I requested repairs, a person claiming to be the corporation’s manager promptly fixed it." Feeling that the corporation was managing things systematically, he felt at ease.

Hell approached slowly. When the contract expiration approached, he asked the landlord to return the deposit, but could not reach him. All he received was a group text saying, "Due to high comprehensive real estate tax, I have become a credit delinquent. The house will be seized. The only way to get your money back is by selling the villa. You can take legal action if you want." "Honestly, even after receiving that message, I didn’t immediately think it was a jeonse scam. My older brother and I went to the Housing and Urban Guarantee Corporation (HUG), and the staff there knew the landlord’s name well. That’s when I realized there were many victims of jeonse scams by this person."

Text message content sent by landlord Kim, known as the 'Villa King,' to tenant Lee living in a villa located in Michuhol-gu, Incheon, on July 5 last year.
[Photo by Lee]

"Landlord is a corporation, so no renewal"… Betrayal by the trusted deposit insurance

However, since he had received 100% of the 'Youth Employment Jeonse Deposit Loan for SMEs' handled by HUG and had also subscribed to the jeonse deposit return guarantee insurance, he never thought he would lose the deposit. Mr. Lee applied for a tenant’s registration order and immediately filed a claim for guarantee performance with HUG. But the corporation said that since the contract period had passed and it was considered an 'implied contract extension,' there was no reason to return the jeonse deposit. However, if he could present the landlord’s ID and text messages consenting to contract termination, the claim review could proceed. "In desperation, I sent 20 text messages and made over 40 calls to the landlord over two days asking for consent to terminate the contract. But the landlord didn’t respond and eventually blocked me." A few months later, landlord Mr. Kim suddenly passed away. The cause of death was reported as cerebral hemorrhage.

Mr. Lee repeatedly requested consent for contract termination from the landlord Kim, known as the Villa King, in order to claim the performance of the return guarantee, but ultimately did not receive a response from the landlord.
[Photo by Mr. Lee]

The only option left for him was to 'renew the guarantee insurance.' Renewing would allow the jeonse loan to be extended and enable a claim three months after the certified mail delivery date reporting contract termination. However, Mr. Lee ultimately could not renew the guarantee insurance because the landlord was a corporation. The bank demanded immediate repayment of 100 million KRW. He was unable to get help from his parents, siblings, or acquaintances, and could not obtain other loans. As a result, his interest payments have been overdue for three months. The loan interest, which was 1.2%, has now soared to 4% due to delinquency.

When Lee failed to repay the loan, his house received a "Notice of Legal Procedure Initiation" and a "Notice of Loss of Benefit of Term" sent from the bank.
[Photo by Mr. Lee]

"My existing credit card was immediately suspended. After work, when I was at home, I felt suffocated every time I received legal notices by registered mail from the bank, such as 'Notice of Initiation of Legal Procedures' and 'Notice of Loss of Benefit of Term.' I didn’t do anything wrong, and the landlord used the money, so why should I bear this? I was furious." Even at work, it was hard to concentrate. Tasks piled up 4-5 times a day, and because of the small workforce at the company, it was difficult to take time off to visit HUG, so he felt awkward about going. He said, "I originally had migraines, but since this happened, they have sometimes become so severe that I can’t see clearly. I have to work to repay the debt, so I take medicine and keep working."

"I don’t even expect the deposit back... I just want my credit restored"

Mr. Lee, who cannot even turn on the boiler in the dead of winter due to lack of money and lives wearing a padded jacket, thermal underwear, and sleeping socks, has one immediate wish. "Of course, it would be best if I could get back the 114 million KRW jeonse deposit. But is that really possible? What I want right now is to restore my credit score. Being 24 years old and responsible for all living expenses on a monthly salary of 1.8 million KRW is almost like a death sentence." His hope is to regain his credit score so he can live with at least a glimmer of hope for the future. This is the wish of Mr. Lee, a 20-something victim of a jeonse scam.