Seoul Metropolitan Government to Provide Early Project Funding for Moa Housing Projects... Up to 2 Billion Won in Loans per Association

[Financial News] Seoul Metropolitan Government will provide loan support for the first time to help Moa housing projects that are struggling to secure early-stage funding.
According to Seoul Metropolitan Government on the 27th, the eligible recipients are associations for block-unit housing rearrangement projects and small-scale reconstruction and redevelopment projects under the Special Act on the Maintenance of Vacant Houses and Small Houses.
Associations that have obtained approval to establish a union and are in the stage before approval of the project implementation plan can receive loans of up to 2 billion won per district, within 5% of total project costs, at an annual interest rate of 2.2%. The funds can be used for early project expenses such as operating costs, design fees, service contracts, and general meeting expenses.
The program was introduced to ease the initial financial burden on small-scale maintenance project associations that have relied on financing from the Korea Housing & Urban Guarantee Corporation (HUG).
Associations seeking loans can submit their application forms and required documents to the maintenance project division of the autonomous district with jurisdiction over the project site from Sept. 7 to Sept. 28.
After review by the autonomous district, a loan screening by the Seoul Housing & Urban Development Corporation (SH Corporation), and approval by Seoul Metropolitan Government, the final beneficiaries and loan amounts will be decided in October. The loans will then be executed through SH Corporation.
The loan period is three years from the initial disbursement date. If project implementation plan approval has not been obtained, the term can be extended by one year at a time with approval from Seoul Metropolitan Government. Repayment will be made in a lump sum of principal and interest at maturity, and a loan guarantee certificate from HUG will be used when the loan is issued.
However, districts that have already received early project funding from HUG cannot apply for Seoul Metropolitan Government loans because duplicate support is not allowed. Districts whose approval to establish a union has been revoked, districts involved in lawsuits over the existence of the union, and districts that have designated a private operator as a joint project implementer, designated developer, or project agent are also excluded.
Myung No-jun, director general for housing at Seoul Metropolitan Government, said, "We hope that associations for small-scale housing maintenance projects, which are facing funding shortages at the early stage of their projects due to the construction downturn, will be able to overcome these difficulties and move forward smoothly through this loan support." He added, "We will continue to strengthen public support to revitalize small-scale housing maintenance projects."

[email protected] Choi A-young Reporter