HUG, HF and SGI to Share Information on Landlords Who Failed to Return Jeonse Deposits, Restrict Guarantee Coverage

[Financial News] Starting in October, guarantee coverage will be restricted for homes owned by landlords whose jeonse deposits were not returned and were paid by a guarantee institution on their behalf. From the 21st of this month, tenants will be able to check whether a landlord is subject to a guarantee restriction through the Safe Jeonse app.
According to the Korea Housing & Urban Guarantee Corporation (HUG) on the 7th, HUG, the Korea Housing Finance Corporation (HF), and Seoul Guarantee Insurance (SGI) will jointly implement a system to share information on landlords subject to guarantee restrictions starting October 1. Information on landlords for whom one institution has made a subrogation payment will be shared and used by all three institutions, limiting the issuance of guarantees for homes owned by those landlords.
A subrogation payment refers to a guarantee institution paying a tenant’s jeonse deposit on the landlord’s behalf when the landlord is unable to return it. The three guarantee institutions plan to share information on landlords who failed to return deposits to prevent repeated jeonse fraud and additional guarantee-related incidents.
The information will be integrated through Korea Credit Information Services. Each guarantee institution will send its information on landlords subject to guarantee restrictions to Korea Credit Information Services, which will compile the data and provide it back to HUG, HF and SGI.
The information covered will concern landlords who failed to return deposits in cases arising after the revised Enforcement Decree of the Credit Information Act took effect on February 3. Under the revised decree, the information may be collected and shared among institutions without obtaining separate consent from the landlords.
Even after the information-sharing system among the guarantee institutions becomes operational, actual restrictions on guarantee issuance for landlords who failed to return deposits will take effect on October 1.
A service allowing consumers to check whether a landlord is subject to a guarantee restriction will be available earlier. Starting on the 21st, users can look up the information through the “Landlord Information Search” menu in HUG’s Safe Jeonse app.
The measure follows the Financial Services Commission’s “Household Debt Management Plan,” announced on February 27 last year. It was introduced to expand the foundation for information sharing among guarantee institutions to prevent financial fraud in the real estate sector.
[email protected] Choi Ga-young Reporter