[Exclusive] KHFC Moves to Expand Housing Supply, Considers Purchasing Homes from Troubled Projects

2026 Business Plan

Korea Housing Finance Corporation (KHFC) is set to announce measures to expand housing supply. The corporation is considering a plan to purchase homes from projects where it had provided guarantees if those projects encounter problems. Additionally, discussions are underway on allowing the children of reverse mortgage users to inherit the reverse mortgage, in order to strengthen the guarantee of the reverse mortgage program.

According to the office of Lee Jeongmoon, a member of the National Assembly’s Political Affairs Committee from the Democratic Party of Korea, on January 9, KHFC submitted its "2026 Business Plan" to the Financial Services Commission. KHFC stated that it will strengthen support for business guarantees to expand housing supply. To improve the structure of supplier financing, the corporation plans to utilize indirect investment vehicles such as Real Estate Investment Trusts (REITs) and real estate funds, and is reviewing a plan to purchase homes from guaranteed projects that have experienced accidents. It will also prepare support measures for redevelopment projects, improve the fast-track system for public land support, and promote the activation of municipal government agreement guarantees. KHFC will consider measures to securitize project financing (PF) loans and gradually raise the self-capital ratio for developers, providing stable support for housing businesses in parallel.

KHFC is also working to strengthen the guarantee of the reverse mortgage program. The reverse mortgage allows homeowners aged 55 or older to use their homes as collateral, continue living in their homes, and receive lifelong monthly pension payments for retirement. KHFC is reviewing institutional support measures that would allow the children of reverse mortgage users to utilize the collateralized home for their own reverse mortgage after the original user’s death. Alongside this, the corporation is pursuing institutional improvements to expand the exceptions for moving in and actual residence requirements for the reverse mortgage. Currently, at least one of the homeowners or their spouse must actually reside in the collateralized home to qualify for the reverse mortgage. However, exceptions are recognized only in unavoidable situations such as hospitalization for medical treatment or relocation to senior welfare housing.

This year, KHFC will also expand the supply of policy mortgages such as the Bogeumjari Loan and the Didimdol Loan. The supply plan for policy mortgages has been increased by 2.75 trillion won, from 17.25 trillion won last year to 20 trillion won.