- Cuts to range between 13% and 60% depending on type of housing to which the guarantee applies

Low-income buyers, builders of eco-friendly housing, and small- and medium-sized constructors in non-metropolitan areas may benefit from significant reductions in guarantee fees when they take out a housing guarantee from the Housing Finance on or after April 5, 2010. 

Housing Finance (KHFC, CEO Joo-jae Lim) announced a plan to reduce guarantee fees to relieve the burden of borrowing costs for low-income workers, builders of eco-friendly housing*, and small- and medium-sized constructors in non-metropolitan areas.   

* Eco-friendly housing refers to energy-saving homes pursuant to Article 64 of the Regulations on Housing Construction Standards; all building projects of 20 or more residential units as of October 2009 are mandated, by law, to comply with eco-friendly standards.   

The proposal will allow low-income workers and people with an annual income of 30 million won or less to take advantage of guarantee fee cuts by as high as 33% and as low as 25% (0.3%-0.4% → 0.2%-0.3%); the fees for builders of eco-friendly housing and small- and medium-sized constructors in non-metropolitan areas will be reduced by a maximum of 19% and a minimum of 13% (0.8% → 0.65%-0.7%). 

Cuts to range between 13% and 60% depending on type of housing to which the guarantee applies

Low-income buyers, builders of eco-friendly housing, and small- and medium-sized constructors in non-metropolitan areas may benefit from significant reductions in guarantee fees when they take out a housing guarantee from the Housing Finance on or after April 5, 2010. 

Housing Finance (KHFC, CEO Joo-jae Lim) announced a plan to reduce guarantee fees to relieve the burden of borrowing costs for low-income workers, builders of eco-friendly housing*, and small- and medium-sized constructors in non-metropolitan areas.    

* Eco-friendly housing refers to energy-saving homes pursuant to Article 64 of the Regulations on Housing Construction Standards; all building projects of 20 or more residential units as of October 2009 are mandated, by law, to comply with eco-friendly standards.   

The proposal will allow low-income workers and people with an annual income of 30 million won or less to take advantage of guarantee fee cuts by as high as 33% and as low as 25% (0.3%-0.4% → 0.2%-0.3%); the fees for builders of eco-friendly housing and small- and medium-sized constructors in non-metropolitan areas will be reduced by a maximum of 19% and a minimum of 13% (0.8% → 0.65%-0.7%). 

In addition, buyers or people renting housing built by public constructors who have signed a strategic partnership agreement with KHFC will benefit from a reduction in guarantee fee as high as 60% and as low as 25% (0.2%-0.5% → 0.15%-0.2%) if they take a collective KHFC guarantee for the payment of the deposit money. 

-          Currently, LH is the only institution with which KHFC has signed a strategic partnership agreement as regards guarantee fee reduction as of March 18, 2010. KHFC plans to gradually sign more strategic partnership agreements with other institutions.   

According to KHFC, the guarantee fee reductions are expected to result in a savings of 4.7 billion won, including 3.7 billion won in savings for 176,000 households using the guarantee on rental deposit money from KHFC.