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Korean Job Discussion Forums
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Stan Rogers
Joined: 20 Aug 2010
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 Posted: Sat Jun 01, 2013 7:11 pm Post subject: |
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| tob55 wrote: |
| furtakk wrote: |
How about loans?
Is it hard to qualify for a decent sized loan on an F5? |
On the F5 you CAN qualify for a larger loan, but it is tied directly to your credit line with the bank. Once upon a time I was told by Nonghyup bank that I could only get a marginal sized loan because of my credit history with the bank. They suggested that I increase my activity with them in order to qualify for something significantly larger.
As concerning citizenship, the same qualification rules do not apply. I know this because my wife in the past has been able to secure a loan of more than 50 mil KRW, and she hasn't worked out of the home for any significant amount of time since we married 9 years ago. So, I am not 100% sure, but I would guess that the rules which apply to foreigners on the F5 are still much different than the rules which apply to Korean citizens. |
OMG. This is what I don't understand about Korean banking. An F5 holder with a job cannot get a sizable loan but a Korean with no job can just walk in an borrow large amounts of money.  |
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giraffe
Joined: 07 Apr 2009
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| Posted: Sat Jun 01, 2013 8:46 pm Post subject: |
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It depends what kinda of loan you're applying for... If its for a mortgage/joensei a citizen can apply for a loan no problem without a proper job. I know because my wife only works part time and would have no problem getting such a large loan. those LARGE loans arent a very big deal because the one borrowing is only paying the interest amount. When you move out of your apt the bank gets everything 100% back. monthly interest is very low so even someone with a part time / low income can afford it. Its something like 300k won monthly for 100 million won.. Banks are making a crap load of money this way with very very little risk... loaning this kind of money to a foreigner would be HIGH risk given that they would technically leave the country anytime...
HOWEVER even a citizen cannot get a general loan without showing collateral... ie: owning land, owning and apt, having a sizable deposit of your own money in jeonsei, having a business ...
As an F6 visa holder myself. I cannot apply for a jeonsei or a mortagage loan ( at least none of the banks I've talked too but i know some have been able too) BUT i can apply for general loan as long as i have collateral to show. That collateral could be your own land or apt or deposit money being held in jonsei OR it could be a co signer / someone elses collateral.. |
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slothrop
Joined: 03 Feb 2003
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| Posted: Sat Jun 01, 2013 9:36 pm Post subject: |
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edit
Last edited by slothrop on Mon Jun 10, 2013 7:02 pm; edited 1 time in total |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Sun Jun 02, 2013 8:25 am Post subject: |
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| giraffe wrote: |
It depends what kinda of loan you're applying for... If its for a mortgage/joensei a citizen can apply for a loan no problem without a proper job. I know because my wife only works part time and would have no problem getting such a large loan. those LARGE loans arent a very big deal because the one borrowing is only paying the interest amount. When you move out of your apt the bank gets everything 100% back. monthly interest is very low so even someone with a part time / low income can afford it. Its something like 300k won monthly for 100 million won.. Banks are making a crap load of money this way with very very little risk... loaning this kind of money to a foreigner would be HIGH risk given that they would technically leave the country anytime...
HOWEVER even a citizen cannot get a general loan without showing collateral... ie: owning land, owning and apt, having a sizable deposit of your own money in jeonsei, having a business ...
As an F6 visa holder myself. I cannot apply for a jeonsei or a mortagage loan ( at least none of the banks I've talked too but i know some have been able too) BUT i can apply for general loan as long as i have collateral to show. That collateral could be your own land or apt or deposit money being held in jonsei OR it could be a co signer / someone elses collateral.. |
Credit really is hard to get here isn't it? I had a friend a few years ago married to a Korean woman who went through this. The bank wouldn't give them a loan until they built their building. So, he brought money into the country and paid to have it built. Then took out a loan from the bank and sent that money back to the states. Really weird system they have here. No wonder small business can't rise up and get big. Banks won't lend any money.
As for that other thing about Jeonse. What makes the bank lend that? Doesn't seem to make economic sense to me. If the interest is quite low, it seems below the market rate. Is this government regulations or something like that? |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Sun Jun 02, 2013 8:55 am Post subject: |
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| Also, knew a Korean American married to a Korean working in a public school for EPIK. She was in the process of getting her Korean citizenship and was going to be terminated. She stopped her citizenship just in time to keep her job. So, if you want to work for EPIK, stay an F5, I guess. |
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tob55
Joined: 29 Apr 2007
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| Posted: Sun Jun 02, 2013 12:17 pm Post subject: |
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| Weigookin74 wrote: |
| Also, knew a Korean American married to a Korean working in a public school for EPIK. She was in the process of getting her Korean citizenship and was going to be terminated. She stopped her citizenship just in time to keep her job. So, if you want to work for EPIK, stay an F5, I guess. |
If she was going to be a dual citizen they may have been able to keep her employed. However, if she chose to go that route then it was probably a good thing. |
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giraffe
Joined: 07 Apr 2009
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| Posted: Sun Jun 02, 2013 5:21 pm Post subject: |
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| Weigookin74 wrote: |
As for that other thing about Jeonse. What makes the bank lend that? Doesn't seem to make economic sense to me. If the interest is quite low, it seems below the market rate. Is this government regulations or something like that? |
Different kind of housing market here in korea. Id wager millions of people borrow jeonsei. So how does it not make economic sense for a bank here to get into that kind of business? Say people borrow 100 million won for 2 years with an interest rate of 4%. over 2 years the bank would be making 8 million won worth of interest money + at the end of the 2 years they get the 100 million won back... Times that a few millions times and banks are making billions of wons ... I'm over simplifying it of course... Its just how things work here... Generally speaking its low risk for banks to lend this kind of housing money to koreans, even those with crappy part time jobs.... It has very little to do with how good your credit history...
Mortgages are slightly different than jeonsei loans because you have to pay off the principle on top of the interest rate. Banks here will ask for a job certificate and or collateral. Not all citizens would be able to borrow a mortgage. I think generally speaking this would be out of question for foreigners ( even those on F visas) HOWEVER i suppose this would be up to the loan officer/ banks manager discretion...
I wont lie, I have no clue how the korean "credit history" system works and if there really is one. I imagine if you / or a citizen want to borrow a smallish amount of money and have a good reputation with your bank they probably would let you... BUT I can guarantee you that even if a citizen wanted to take out a somewhat large amount general loan It mostly has to do with if you have Collateral or not. Banks wont just loan out 50-100 million+ won general loan ( not for housing) to a citizen just because they have a good reputation/ credit history even if their job brings in alot of money. Theyll ask you to put up collateral ie: an apt you own or have your own money for jeonsei, a business etc...
Anyways, my wife and I just recently bought/invested into a new apt ( yet to be built). The bank allow us ( and every one else buying an apt) to borrow up to 60% of the housing price for the mortgage @ a 3.5% yearly interest rate. over 90% of people buying apts in our complexe are taking this loan. The requirement for the loan is pretty simple. Because this is a mortgage ( I'm not sure how many years they expect you to pay everything back though.. probably less than 5 years but you can just keep extending it) you either need collateral or you need an employment letter stating you make you make a certain amount of money monthly. No need for "credit" or a good credit history because the loan has nothing to do with your Bank Branch. You have to borrow with bank thats in charge of the Apt complexe. IN this case Shinanh bank which I have nothing to do with.
Either way, We're not taking the Loan. We'll be paying the house cash 100%. I'm just explaining my personal experience/info that i have about loans having looked up the information because it was something we might have wanted to do... instead we decided against it and that well just pay for it ourselves completely... |
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tob55
Joined: 29 Apr 2007
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| Posted: Mon Jun 03, 2013 1:16 pm Post subject: |
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Bank loans in Korea are discretionary and left to the individual bank to decide who is credit worthy. My wife has had dealings with several banks and never was refused based on income or colateral. She has a spotless credit record, which is something they DO look at, i.e. if you ever had a creditcard or other loans, these records are all on file as Korean citizens, regardless of the bank you are attempting to do business with. My wife has always had a simple rule, pay your bills on time and never get close to the Korean "blacklist."
The bank can tell you if you were ever late by one day on your creditcard or other payments, because they have access to those types of records when people apply for loans. Of course people will cry data privacy, but in the Korean system of money and loans it doesn't exist for the most part. This is why so many foreign residents who had creditcards, maxed them out, and then decided to leave the country have made it so hard for others to get any good creditcards these days.
I am not going to argue the logisitcs of having a loan with a given bank or financial institution, but the ability to get a loan if that is what you want to do is something that would have to be negotiated with the particular bank you want to do business with. The mortgage payment system in Korea is quite different than in other countries, and I have never really understood it, but for the few loans we have had over 100 mil KRW, which are all paid now thankfully, I asked questions, but still don't understand everything completely. |
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giraffe
Joined: 07 Apr 2009
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| Posted: Mon Jun 03, 2013 11:35 pm Post subject: |
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Of course its up to the banks discretion who they loan to and obviously they wont be giving money to just ANYONE.
may I ask, whats the name of the loans your wife applied /borrowed and what were they for? ie: Jeonsei ? mortgage? or was it just a general 대출 loan?
IF it was for housing/ jeonsei/mortgage Those loans are VERY VERY easy to get for any citizen....
I would be extremely suprised that your wife's bank would loan her 50- 100 million won as a "general loan" . By general loan i mean Not related to housing like jeonsei or mortgage!!!! large General loans ( 50 million +) are HARD to get in korea even with spotless/ perfect credit history. My father in law has a successful business and a very very good credit history of borrowing / paying back the money 100% with credit cards and past loans etc.. with his bank not to mention 30+ years of being a customer with them and every time he needs to borrow 50 million won ( GENERAL LOANS.. NOT FOR HOUSING) He ALWAYS had to provide collateral. No IFS or BUTS about it.
And Its been the same thing for my wife and I with a few other banks aswell. We can borrow 100 million won NO problem if its for jeonsei or a mortgage But if its for a same amount general loan You can forget about it unless you have some collateral to put up against the loan... |
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tob55
Joined: 29 Apr 2007
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| Posted: Mon Jun 03, 2013 11:57 pm Post subject: |
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| giraffe wrote: |
Of course its up to the banks discretion who they loan to and obviously they wont be giving money to just ANYONE.
may I ask, whats the name of the loans your wife applied /borrowed and what were they for? ie: Jeonsei ? mortgage? or was it just a general 대출 loan?
IF it was for housing/ jeonsei/mortgage Those loans are VERY VERY easy to get for any citizen....
I would be extremely suprised that your wife's bank would loan her 50- 100 million won as a "general loan" . By general loan i mean Not related to housing like jeonsei or mortgage!!!! large General loans ( 50 million +) are HARD to get in korea even with spotless/ perfect credit history. My father in law has a successful business and a very very good credit history of borrowing / paying back the money 100% with credit cards and past loans etc.. with his bank not to mention 30+ years of being a customer with them and every time he needs to borrow 50 million won ( GENERAL LOANS.. NOT FOR HOUSING) He ALWAYS had to provide collateral. No IFS or BUTS about it.
And Its been the same thing for my wife and I with a few other banks aswell. We can borrow 100 million won NO problem if its for jeonsei or a mortgage But if its for a same amount general loan You can forget about it unless you have some collateral to put up against the loan... |
My wife has gotten three 30mil KRW signature loans through Nonghyup and Wooribank that were not mortgage or Jeonsei related with no need for using any collateral. It may be her luck, and we haven't had the need or want to borrow money in the past few years, but that was the case with her. Perhaps they have a set amount that they designate for needing collateral, and we never reached it. Not sure, but the only time collateral was ever requested was for a significantly larger amount that was well over 200 mil. We decided not to do it because it was really more than we were willing to pay interest wise. |
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giraffe
Joined: 07 Apr 2009
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| Posted: Tue Jun 04, 2013 12:13 am Post subject: |
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| tob55 wrote: |
My wife has gotten three 30mil KRW signature loans through Nonghyup and Wooribank that were not mortgage or Jeonsei related with no need for using any collateral. It may be her luck, and we haven't had the need or want to borrow money in the past few years, but that was the case with her. Perhaps they have a set amount that they designate for needing collateral, and we never reached it. Not sure, but the only time collateral was ever requested was for a significantly larger amount that was well over 200 mil. We decided not to do it because it was really more than we were willing to pay interest wise. |
Yeah thats what I thought... The loans your wife applied for were below 50 million seperately... Wife and I can get general loans for below 50 million without collateral but anything 50 million + for a general loan they require collateral! BUT on the other hand if we got a jeonsei or mortgage of say 100 million+ There was no need of collateral at all..... I dont think it has anything to do with luck... More to do with which loans you apply for and how much they are.
I was always talking about LARGER loans of at least over 50 million won . Like you said you tried to borrow over 200million under your wifes name and they did require collateral. Which has been the same kind of experience I've had with Banks. Smaller general loans arent a problem.
thanks for clarifying! |
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tob55
Joined: 29 Apr 2007
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| Posted: Tue Jun 04, 2013 3:43 am Post subject: |
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| giraffe wrote: |
| tob55 wrote: |
My wife has gotten three 30mil KRW signature loans through Nonghyup and Wooribank that were not mortgage or Jeonsei related with no need for using any collateral. It may be her luck, and we haven't had the need or want to borrow money in the past few years, but that was the case with her. Perhaps they have a set amount that they designate for needing collateral, and we never reached it. Not sure, but the only time collateral was ever requested was for a significantly larger amount that was well over 200 mil. We decided not to do it because it was really more than we were willing to pay interest wise. |
Yeah thats what I thought... The loans your wife applied for were below 50 million seperately... Wife and I can get general loans for below 50 million without collateral but anything 50 million + for a general loan they require collateral! BUT on the other hand if we got a jeonsei or mortgage of say 100 million+ There was no need of collateral at all..... I dont think it has anything to do with luck... More to do with which loans you apply for and how much they are.
I was always talking about LARGER loans of at least over 50 million won . Like you said you tried to borrow over 200million under your wifes name and they did require collateral. Which has been the same kind of experience I've had with Banks. Smaller general loans arent a problem.
thanks for clarifying! |
No problem, we don't generally like to carry a high debt load here anyway since the economy is in such flux right now. I believe many people are having a very hard go of things right now. We just had a guy who owns 3 apartments with no debt asking to borrow 30 mil from us. He is solvent in many ways, but he is cash broke right now and his wife's medical situation set him back, thus he was stuck asking friends to help bail him out, and certainly RushnCash wasn't an option for him. |
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