Seniors Aged 55 and Older Eligible for JTYK

- Eligibility age lowered by five years from April 1

From April 1, 2020, homeowners aged 55 and older are eligible to take out a JooTaekYeonKeum (JTYK) reverse mortgage. 

Korea Housing Finance Corporation (HF, CEO Lee Jung-Hwan) said on March 30, 2020, that it will lower the minimum eligibility age for JTYK to 55 years. This decision came as the Korea Housing Finance Corporation Act, which governs the eligibility requirements for JTYK, was revised after the government policy announcement to assist people in building assets for their retirement years* (as discussed in the recent cabinet meeting for economic stimulus measures on November 13, 2019).  

 * Measures to increase JTYK subscriptions as discussed at the presentation “Impact of and Response to Demographic Changes” made at the 26th Cabinet Meeting (including the Financial Services Commission) on Economic Stimulus Measures held on November 13, 2019

Accordingly, if homeowners or their spouses who are 55 years old subscribe to JTYK with their home valued at KRW 500 million, they can receive KRW 770,000 in monthly payouts for the rest of their life. As homeowner couples on JTYK receive monthly payouts for as long as they live, eligibility remains dependent on the age of the younger spouse.

In addition, JTYK allows its subscribers to withdraw a portion of their equity to pay off their existing mortgage loan, reducing their burden of principal repayment. For instance, a homeowner aged 55 or older with a home valued at KRW 500 million can withdraw up to 90% (or KRW 135 million) of their home equity in a lump sum and use it to repay their mortgage loan and receive the remaining equity in monthly payouts.

For a single home valued at KRW 150 million or less, homeowner couples with at least one spouse on the Basic Livelihood Security program (aged 65 years or older) are eligible for a preferential JTYK scheme, receiving 20% more in monthly payout amounts than ordinary JTYK subscribers. 

An HF official said, “After early retirement, older adults often lack a stable income flow until their public pension payments begin. With these changes, however, they can receive a fixed amount of monthly payouts from JTYK. HF will continue to improve our JTYK program so that it can be a viable financial strategy to ensure a secured retirement.”