Provision of Jeonse Loan Guarantees Soars Sharply 

According to KHFC, in February this year, the provision of jeonse loan guarantees through the Housing Finance Credit Guarantee Fund (HFCGF) for households not owning homes totalled KRW248.1 billion. This represents 36% growth compared to KRW182.8 billion in January and 58% growth compared to KRW157.0 billion in the same period last year.

Net new provision, which excludes rollovers, totaled KRW194.0 billion. This represents a 32% increase from KRW146.5 billion in the previous month. Compared to the KRW107.3 billion in the same period last year, it marks a sharp rise of 80%.

On the basis of new users, the monthly number of jeonse loan guarantee users increased by 1,585 users or 25% from 6,349 users in January to 7,934 users in February.

Such a sharp growth in jeonse loan guarantees may be ascribed to the continued rise of jeonse contract prices in the capital region. In addition, demand for jeonse contracts is concentrated in February when the new school semester begins and many move house 

Jeonse Loan Guarantees offered by KHFC is a guarantee service whereby individuals who do not own homes can easily borrow money from a bank to rent a house without providing collateral or obtaining a co-signatory. Heads of households aged 20 or older having dependents are eligible to apply for the guarantee service. Heads of households without dependents but who are planning to get married or who are in receipt of income are also eligible.