South Korea’s Financial Services Commission (FSC) has announced a package of measures to increase income benefits and improve user convenience for reverse mortgage subscribers. The changes focus on higher monthly payouts, lower upfront costs with an adjusted ongoing fee, and rule changes to ease the primary-residence requirement and facilitate re-subscription by heirs. For new subscribers from after March 1, 2026, the reverse mortgage actuarial model will be redesigned, lifting monthly payments for an average subscriber aged 72 with a KRW 400 million home by about 3.13% to KRW 1,338,000 from KRW 1,297,000, with total payments over a 17.4-year subscription period forecast to rise by about KRW 8,490,000. Upfront costs will also change from after March 1, 2026, with the initial guarantee fee rate cut to 1.0% from 1.5% and the refund-eligible period extended to five years from three, while the annual guarantee fee on the outstanding loan balance will rise to 0.95% from 0.75%. Additional payment support for low-priced homeowners will be expanded for homes with market value below KRW 180 million, increasing the extra monthly payment for an average eligible homeowner with a KRW 130 million home to KRW 124,000 from KRW 93,000 for new subscribers from after June 1, 2026. From June 1, 2026, exceptions to the primary residency requirement will be allowed for unavoidable circumstances such as health-related absences, family care needs, or nursing home residence. The FSC also plans to allow a deceased subscriber’s child aged 55 or older to take out a reverse mortgage on the same home without first repaying the parent’s reverse mortgage debt, and it will continue working with the Korea Housing Finance Corporation and related ministries on further rule improvements, including for subscribers outside the Seoul metropolitan area.
South Korea Financial Services Commission 2026-02-05
South Korea Financial Services Commission raises reverse mortgage payments and reduces upfront guarantee fees from March 2026
South Korea's Financial Services Commission announced measures to enhance reverse mortgage benefits, including increased monthly payouts, reduced upfront costs, and eased primary-residence requirements. Changes effective from March 1, 2026, include a redesigned actuarial model, while from June 1, 2026, exceptions for primary residency and re-subscription by heirs will be introduced.