[Mortgage Transfer Boom] ① Over 10,000 Transfer Applications in Half a Month... Application Amount Reaches 1.8 Trillion Won

Refinancing-Only Products with Interest Rates in the Mid to High 3% Range
1 Percentage Point Lower than New Loan Products
Stress DSR Applied from February
Refinancing Demand Concentrates Before Implementation

The 'Mortgage Refinancing' service through an online, one-stop refinancing infrastructure is gaining sensational popularity in its early stages. Within 15 days of the service launch, the number of refinancing applicants exceeded 10,000, and the application amount approached 1.8 trillion KRW.

According to the financial sector on the 25th, as of the 23rd, the cumulative number of mortgage refinancing product applications from the five major domestic commercial banks (KB Kookmin, Shinhan, Hana, Woori, NH Nonghyup) totaled 10,560 cases, with an amount of 1.7977 trillion KRW. This achievement was reached within just half a month since the service started on the 9th.

There was a significant variation among banks. The bank that attracted the most mortgage refinancing customers recorded about 6,000 applications, with an application amount of approximately 1 trillion KRW. The gap between this bank and the one with the smallest application amount was about 14 times. The average refinancing application amount per case was about 1.7 billion KRW.

However, the number and amount of finalized refinancing executions were still minimal. This is because the loan screening process can take more than a week after applying for refinancing.

The reason for the mortgage refinancing service's popularity is attributed to relatively low interest rates. The refinancing-exclusive product interest rates (mixed rates) of major banks are in the mid-to-high 3% range. This is a 1 percentage point difference compared to the interest rates of newly issued mortgages by the five major banks last month (4.55% to 4.79%).

Another factor contributing to the popularity is the upcoming implementation of the stress Debt Service Ratio (DSR) regulation starting in February. Stress DSR refers to adding a stress interest rate that considers economic or borrower condition fluctuations to the existing DSR calculation.

Borrowers who are expected to face reduced loan limits due to the stress DSR application are now in a situation where they must attempt refinancing before the regulation takes effect. A financial sector official stated, "Refinancing demand is expected to concentrate until early to mid-February, before the stress DSR is fully applied."