Abolishing 'Marriage Penalty' and Introducing Housing Loans Under 400 Million Won for Youths

[Anchor]

Measures have also been included to address criticisms from the younger generation that marriage actually makes it harder to secure a home. A new financial product will be created that lowers interest rates for youths purchasing homes priced at 400 million won or less—rather than apartments—while allowing them to retain their first-time homebuyer benefits later on even if they upgrade to an apartment.

[Reporter] Min Gyeongho reports.

[Reporter]

Let us imagine a prospective couple, each with an annual income of 50 million won.

Before marriage, they were naturally eligible to use the Bogeumjari Loan [Mortgage loan product], which requires an individual income of 70 million won or less.

However, the moment they get married, it becomes unavailable.

This is because for newlywed couples to use the Bogeumjari Loan, their combined income had to be 85 million won or less.

Consequently, criticisms emerged asking whether marriage is actually a penalty and whether the government is making people hesitate to marry while worrying about the birth rate.

Starting in October, the rule will change so that eligibility is met if the income of just one spouse is 70 million won or less.

A new Youth Future Bogeumjari Loan will also be established.

Under this loan, youths aged 39 or younger with an annual income of 70 million won or less who purchase non-apartment homes priced at 400 million won or less will receive preferential interest rates, allowing them to borrow up to 80 percent of the property value.

Similarly, for newlywed couples, only one person needs to meet the income requirement.

Financial authorities cited an example of borrowing 200 million won at an interest rate of about 3 percent.

They explained that in this case, borrowers would repay 850,000 won in principal and interest per month, effectively enabling them to live in a home for the price of monthly rent.

While some have pointed out that apartments cannot be purchased with this, the government explained that the product's very purpose is to act as a stepping stone for youths to buy their own homes, and it was designed with properties such as officetels in mind.

Therefore, the government added that purchasing a home through this product will not forfeit first-time homebuyer benefits.

The government also announced that starting in the second half of this year, it will raise the income requirements for newlywed couples regarding housing subscriptions, loans, and public rental housing admissions to about twice the level for single individuals. Furthermore, even if income and other criteria are exceeded due to marriage after moving in, tenants will not be forced to evacuate immediately and will be allowed to renew their contracts one more time.

Standardized public rental housing with high-end interiors will also be built in station-area locations. While the basic residency period is 6 years, extensions will be granted for every childbirth, allowing a maximum residency of up to 20 years.

(Video Editing: Kim Jong-mi, Design: Kim Ye-ji)
※ Please note: This article was translated by AI and may contain errors.