The cumulative amount of HF MBSs issued reaches 100 trillion won
- Date 2015-03-05
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The cumulative amount of HF MBSs issued reaches 100 trillion won
- This year, HF issues 35 trillion won in MBS and shifts toward a long-term fixed rate in its mortgage loan schemes
- HF provides 35 trillion won in mortgages, 32 trillion won in housing guarantees, and 6.6 trillion won in JTYK reverse mortgages
- HF eases JTYK eligibility requirements to expand JTYK coverage
- HF guarantee is extended to cover land development trusts, enhancing convenience for small and medium-sized construction firms
Korea Housing Finance Corporation (HF, CEO Kim Jae-Chun) announced on the 5th that the cumulative
amount of HF mortgage-backed securities (MBS) issued has exceeded 100 trillion won. It said that it will issue
35 trillion won in MBS this year.
□ The cumulative amount of HF MBS issued has reached 100 trillion won
HF CEO Kim Jae-Chun held a press conference in commemoration of its 11th anniversary at the Bankers' Club
in Myeong-dong, Seoul. In the press conference, CEO Kim said, “The cumulative amount of HF mortgage-backed
securities (MBS) issued now exceeds 100 trillion won. With the MBS issuances, HF has made a significant achievement
in reshaping mortgage lending from mortgages with a short-term variable interest rate and a single lump-sum
repayment at the end of the loan term to long-term fixed rate mortgages repaid in regular installments over
the full term." He added, “The cumulative total of 100 trillion won in MBS issuances was possible because of
the earnest efforts that HF has made for the advancement of the nation's housing finance market and bond market
over the last 11 years since its launch."
Furthermore, he went on to state, “Our target is to issue 35 trillion won in MBS this year. We will continuously boost
the sales of Conforming Loans and Bogeumjari Loan and further improve our MBS issuance structure and process."
□ HF provides 35 trillion won in mortgages such as Conforming Loans and Bogeumjari Loans, 32 trillion won
in housing guarantees, and 6.6 trillion won in JTYK reverse mortgages
This year, HF aims to provide 35 trillion won in mortgages such as Conforming Loans and Bogeumjari Loans,
32 trillion won in housing guarantees such as Jeonse Loan Guarantees, and 6.6 trillion won in JTYK reverse
mortgage loans.
HF CEO Kim said, “HF will offer 20 trillion won in Relief Loans to allow households who took out a floating-rate
mortgage or an interest-only mortgage a year ago or more to switch to a more flexible mortgage. Relief Loans
will ease their interest rate burden and a one-time repayment lump-sum repayment at the end of loan term,
contributing to the government's policy of restructuring household debts."
□ HF expands its JTYK program by easing its eligibility requirements and making other structural improvements,
such as allowing subscribers to be covered by the loan agreement at the time when their property used as
collateral goes through redevelopment or reconstruction
Regarding the JTYK program, he stressed, “We will make structural improvements to the reverse mortgage program,
such as easing eligibility criteria, allowing JTYK subscribers to remain in the loan agreement while their property
used as collateral undergoes urban renewal or reconstruction, and aligning the program with medical indemnity
insurance products. With these changes, we will be able to offer 6.6 trillion won to help the elderly fund their
retirement years."
"As the baby boomers are now flooding into their post-retirement years, we have also launched a bridge JTYK
reverse mortgage loan to provide retirees temporary financing and help them solve short-term financing problems.
This loan product is designed to ease the transition between a reverse mortgage loan from a bank and
an HF-backed JTYK reverse mortgage loan when the borrower turns 60. It aims at addressing the burden
of repayment of a private sector loan at the end of the loan term. This product is currently available only
at Shinhan Bank, but we will soon make them available through other financial institutions," he said.
□ HF guarantee extended to cover the grantor of a land development trust
HF will extend its guarantee to cover land development trust grantors in the first half of this year. A land
development trust is a residential development project in which there is a clear separation between project
fundraising and project management to ensure the stable implementation of the project.
Regarding this, HF CEO Kim added, “HF has expanded the scope of its guarantee for land trust grantors
in the first half of this year, given that constructors and financial institutions prefer land management trusts
because they make it easier to manage funds and are low risk.”