KHFC to lower Bogeumjari loan rate by 0.20%p from September 3, 2012

- Lowest Bogeumjari loan rate at 3.3%

The Korea Housing Finance Corporation (KHFC, CEO Seo Jong-dae) announced on August 27, 2012 that the interest rate of new Bogeumjari loans taken out from September 3, 2012 would be lowered by 0.20%p. This is the fourth time that the rate was lowered, following in February, May, and August. The Bogeumjari loan is a long-term mortgage loan designed by the KHFC.

With the new rates, the current annual rates of regular Bogeumjari loans with fixed rates over the term of the loan (10 years-30 years), which is between 4.5% (10-year loan) and 4.75% (30-year loan), will go down to 4.3% (10 years) and 4.55% (30 years), respectively.

The interest rate of the Prime Rate I Bogeumjari loan (combined annual income with spouse being 25 million won or less), which is offered to low-income earners who purchase a house, will go down to an annual rate as low as 3.3% (10 years), while the annual rate of the Prime Rate II Bogeumjari loan (combined annual income with spouse exceeding 25 million won and being 50 million won or less) drops to a minimum of 3.8% (10 years). The 20-year Prime Rate II Bogeumjari loan, which is similar to the first-time home purchase loan, will be offered at 4.0% yearly, which is 0.2%p lower than the 4.2% rate of the first-time home purchase loan.

“KHFC will offer Bogeumjari loans at a lower rate thanks to savings in financing costs as T-bond rates recently fell and the corporation’s efforts to lower interest rates,” said a KHFC official. “We will remain committed to helping low-income earners without a home to buy a house by supplying the capital for long-term, low interest rate mortgage loans.”