Minister Kim Yun-duk of the Ministry of Land, Infrastructure and Transport said on the 25th that the dedicated mortgage loan terms applied to New Home applicants will be set at up to 40 years with a fixed interest rate of 1.9%–3.0%.
At a roundtable held that day, the Minister said the ministry would accept applying, as is, the loan maturity and interest rates presented for the dedicated mortgage (draft) at the time of the 2022 policy announcement to New Home applicants.
For all households that have completed tenant recruitment to date, the dedicated mortgage will have a maturity of up to 40 years with a fixed interest rate of 1.9%–3.0%. The optional jeonse loan carries a fixed interest rate of 1.7%–2.6%.
The controversy over New Home dedicated mortgage rates arose over whether the loan terms presented when the policy was announced four years ago would apply unchanged at the time of actual move-in. The government at the time gave an example of a maximum 40-year maturity and an annual interest rate of 1.9%–3.0% for the dedicated mortgage, but concerns grew that the terms could change due to recent shifts in market rates and policy conditions. Applicants have said that, because they applied based on the government's announcement, the terms at that time should be guaranteed.
The Minister said, "I fully understand that, having waited a long time to apply, there is significant worry and frustration about the loan terms," adding, "I hope this application plan will be a great help to applicants, and we will continue to manage policy with care going forward."