Mortgage Loans Drive: Back to the Era of ‘Yeong-kkeul’ & ‘Debt Investing’: Household Loans Surge

Mortgage Loans Drive: Household loans at Korea’s five major banks jumped by ₩3.9937 trillion in June and are projected to rise over ₩6.3 trillion by month-end. Mortgage loans—including Jeonse loans—accounted for ₩2.9855 trillion of that increase, making up 80% of total household credit. Driven by expectations of rate cuts and a rush to borrow before July’s Phase-3 stress DSR rules, mortgages have become the primary leverage tool in response to anticipated home price gains.

Unsecured Credit Also Surges: Mortgage Loans Drive 빌딩 매매 사이트

Beyond real estate, stock market investment has driven unsecured credit higher. Credit loans at the five major banks rose by ₩1.0882 trillion from May’s end, reaching ₩104.4027 trillion. With a daily average increase of ₩57.3 billion, loans are expected to grow by another ₩17.755 billion by month-end—the fastest pace since July 2021’s ₩18.637 trillion. This resurgence of “debt investing” underscores its renewed spread across the banking sector.

Last-Minute Borrowing Before Tightening: Regulators’ Clampdown & Rate Cut Constraints

With Phase-3 stress DSR rules looming in July, “last-minute borrowing” demand has spiked. Regulators summoned lending chiefs from all major banks. NH NongHyup halted mortgage refinancing from other banks, and SC First cut loan maturities from 50 to 30 years. Authorities are enforcing monthly and quarterly loan targets and urging restraint on multi-home borrowers to curb short-term credit surges.

Concerns Over Reduced Rate-Cut Leeway

Continued household credit growth could constrain the Bank of Korea’s ability to cut rates. In its revised economic outlook, the BOK slashed this year’s GDP forecast to 0.8% but signaled rate stability to curb the housing binge and debt buildup. Amid supplementary budget pressures and slowing growth, ongoing loan surges may effectively rule out further monetary easing. shift to remodeling