Major Commercial Banks Cut Home Loan Limits in the Second Half of the Year
As home loan limits are reduced, the bar for bank lending is getting even higher. From Shinhan and KB's measures to application restrictions, check how your loan will be affected.
As major commercial banks lower mortgage loan limits and restrict loan applications in the second half of the year, borrowing hurdles at banks are expected to become even higher.
Shinhan Bank has decided to temporarily suspend the handling of mortgage credit insurance (MCI) and mortgage credit guarantee (MCG) from the 10th. These products serve to increase the limit on mortgage loans by the amount of the smallsum tenant deposit, so if they are suspended, the actual amount that can be borrowed will decrease. KB Kookmin Bank will lower the maximum limit for home purchase loans in the metropolitan area and regulated areas from the existing 600 million won to 300 million won starting on the 10th. The same 300 million won standard will also be applied in regional areas, and homes worth over 2.5 billion won will maintain a 200 million won limit.
Behind banks' series of such measures is the fact that household lending, centered on mortgage loans, has been rising rapidly recently. Shinhan Bank and Hana Bank are also suspending new mortgage loan applications through loan brokers, and the trend across the banking sector is toward stronger total volume management. However, concerns are also being raised about the possibility that demand may shift to secondtier financial institutions or private lenders.