Pay off the principal of the credit loan… “Based on repayment ability, differently applied by borrower

Consider how financial authorities impose amortized obligations on large credit loans that exceed borrowers’ income and exceed their ability to repay. Above all, as the purpose of executing a loan that fits the repayment ability of the borrower, it is unlikely that a uniformly determined amount will be presented as an application standard.

According to related industries on the 24th, the financial authorities are raising the need for a plan to avoid excessive loans and pay off the repayment in partial installments, taking into account the current borrower’s repayment capacity and loan period.

Currently, credit loans pay only interest every month until maturity, but they decided to introduce a plan to pay off not only interest but also principal.

Some people thought that the standard of high credit loans was 100 million won, and that they would apply amortization for loans more than 100 million won, but the financial authorities are known to not present a uniform price line.

Above all, considering that each borrower has different repayment capabilities, it is difficult to designate a uniform amount of money, and the position of the financial authorities is that a standard that considers income is necessary.

It doesn’t matter if your credit loan amount is within the range that you can pay off against your income. However, it is the recognition of the financial authorities that if you borrow more than your income, you must apply a brake.

Some argue that other debts, such as mortgage loans borrowed by borrowers, should also be considered when considering repayment ability.

Currently, the financial authorities have decided to switch the method of managing the total debt principal and repayment ratio (DSR) for each financial company to the repayment capacity test for each borrower. Currently, the DSR may exceed 40% for each borrower, but in the future, 40% may be applied to all borrowers.

Besides the borrower’s repayment ability, the maturity is also a variable. The maturity of a credit loan is usually extended on a 1-year basis and can be up to 10 years. It would be pointless to impose an amortization obligation on short-term credit loans maturing less than six months. However, if the maturity is changed to a long term through an extension in the future, the possibility of amortized repayment cannot be excluded.

The financial authorities will confirm detailed plans after listening to the opinions of the banks on the amortization of the credit loan. After this, the details will be announced in the plan to advance household debt in March, and a sufficient grace period will be given until the amortization is applied.