Financial Authorities View President Lee's Apartment Mortgage Registration As 'Private Transaction'

The heads of financial authorities stated today (the 29th) that the establishment of a collateral mortgage on President Lee Jae-myung's Bundang apartment is a 'private transaction' and therefore not subject to regulatory restrictions.

During a work report to the National Assembly's Political Affairs Committee that day, Financial Services Commission Chairman Lee Eok-won responded to a question from People Power Party lawmaker Park Jun-tae asking whether the government could condone President Lee's apartment transaction method, saying, "It was a private transaction, and I do not know the specific details."

He added, "My understanding is that it was conducted by the Blue House in a legal, transparent, and open manner."

In response to a question from People Power Party lawmaker Shin Dong-wook asking if the government was encouraging private lending, he said, "It is not private lending," adding, "It is a matter of how to handle the payment relationship when there is time remaining until the balance is due."

Financial Supervisory Service Governor Lee Chan-jin also stated, "Because it is a transaction between private individuals and not subject to credit loan regulations, the Financial Services Commission and the Financial Supervisory Service have no means to verify it."

Regarding the point that citizens affected by loan regulations might feel it is unfair, he remarked, "If the President were the buyer, it would be understandable, but since he is the seller, I am not quite sure how to explain this aspect."

Meanwhile, Chairman Lee expressed a negative stance regarding calls to ease loan regulations in the real estate market, stating that it would instead create a structure where "the housing ladder moves further away."

Chairman Lee made these remarks in response to comments by People Power Party lawmaker Cho Jung-hun, who argued that loan regulations should be eased, saying, "Taking out a loan means borrowing to earn more, pay off the debt, and grow further."

Chairman Lee said, "Ultimately, when loans are unleashed, this stimulates real estate prices and destabilizes the real estate market once again. I wonder if it is right for us to continue mass-producing a structure where the housing ladder gradually moves further out of reach."

He added, "Instead, areas where genuine homebuyers work hard on their own should naturally be supported."

Regarding the current financial authorities' high-intensity loan regulations and policies supporting genuine homebuyers, he explained, "While maintaining existing aggregate regulations and similar measures, we intend to resolve difficulties faced by genuine homebuyers, ordinary citizens, and young people through targeted support."

Addressing public opinion that recent autonomous reductions in mortgage limits by banks have caused difficulties with balance payments, he stated, "We have not made any policy shifts regarding balance loans; they can still be received within the regulatory framework."

However, he clarified, "Since we are managing the aggregate volume (of household debt), banks have tightened things further (to meet management targets). Therefore, we are consulting with them to ensure that appropriate adjustments can be made where possible, rather than changing policies back and forth."

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.