President Lee orders review of applying new-loan level regulations to extensions and refinancing for multiple-home owners

According to Financial News, President Lee on the 20th ordered the Cabinet and the presidential secretariat to review whether loan maturity extensions and refinancing for multiple-home owners should be regulated in the same way as new loans, in order to ensure fairness in regulations.
In a message posted on X (formerly Twitter), President Lee stated, "Why are we only considering applying the rental income to interest repayment ratio (RTI) regulation when extending loan maturities? Loan extensions or refinancing after the loan period expires are, in essence, no different from new loans." He went on, "If so, shouldn't extensions or refinancing of existing loans on multiple homes be subject to the same lending regulations as those imposed on loans for purchasing additional homes, in order to be fair?"
Regarding how to implement the regulations, President Lee noted, "If fully unwinding the loans all at once would be too much of a shock, we could introduce a minimum transition period and phase it in, for example by unwinding 50% within one year and 100% within two years." He added, "I have instructed the Cabinet and the presidential secretariat to report on the details of lending regulations for new purchases of multiple homes, as well as the current status of loan extensions and refinancing for existing multiple-home owners, and to review firm regulatory measures for them."
President Lee wrote, "To build a country where the people are the true sovereign and everyone in Korea can be happy, we must dismantle the republic of unearned real estate income." He continued, "The people of Korea can do it. The Republic of Korea can do it."
In the market, the financial authorities appear to be moving quickly with follow-up reviews after the president raised the issue. According to the article President Lee shared, the financial authorities discussed maturity extensions for multiple-home owners at a second inspection meeting with financial institutions, and considered applying the RTI rule—previously imposed only when landlords first take out a loan—at every annual extension. However, some in the industry are cautious about whether tighter lending rules will immediately translate into a surge of properties being put up for sale.
west@fnnews.com Reporter Seong Seok-woo Reporter