“ Loan Management Personalized for Bogeumjari Loan Borrowers ”

- Expect to ease repayment burden through loan management personalized for each individual -

The Korea Housing Finance Corporation (KHFC) announced on May 24 that it is in the process of improving the personalized customer loan management program in order to afford Bogeumjari loan customers greater convenience and reduce their repayment burden on overdue loans considering the challenging housing market situation.

According to the proposed improvement plan, overdue interests accrued due to the death of a Bogeumjari loan borrower may be exempted for up to three months. Changing the date of monthly payment, which was allowed only once due to the nature of Bogeumjari loans as they need to guarantee a certain cashflow to MBS investors, is also allowed additionally for a compelling personal reason such as a change in a borrower's payday.

Also, in order to prevent a borrower who experiences temporary difficulty in loan payment from becoming a long-term delinquent with a large amount in arrears, forfeiture of benefit of time* may be postponed for one month depending on the individuals' debt service capacity. For those delinquent by at least one month who cannot pay back amounts in arrears in their entirety, the timing of an auction may be postponed to allow repayment in installments.

* Forfeiture of benefit of time: Based on a loan agreement, a customer has the right to use a loan until its maturity. However, the financial institution may collect the loan before its maturity for such reason as overdue loan payments.

“We focused our improvement efforts on making normalization easy by lowering the payment burden for temporary delinquents, and we will continue to work to increase customer convenience,” said an official at KHFC.