Business · Economy · 2 hrs ago
South Korean mortgage rates rise above 6% at four major banks
Variable mortgage rates at four of South Korea’s five largest banks topped 6% on Oct.
16.
The rates apply to home loans that can change every six months, and they ranged from 4.82% to 6.25% across the five banks.
The increase followed a 0.25-percentage-point rise in COFIX, a benchmark used to set variable mortgage rates and its largest jump in nearly four years.
For a 400 million won loan over 30 years, the estimated monthly payment at the lowest available rate rose from 1.93 million won in January to more than 2.1 million won.
Borrowers whose fixed-rate periods are ending may also face higher bills: one example in the report saw a monthly payment rise from 2.27 million won to 2.79 million won.
165 trillion won in mortgages are due for rate changes in the fourth quarter, according to data submitted to a lawmaker by the Financial Supervisory Service.
Experts expect rates to keep rising, while warning that sharp increases could add to financial distress and unsettle property and stock markets.
Variable mortgage rates at four of South Korea’s five major banks rose above 6%, with Shinhan Bank the exception.
The five banks’ six-month variable mortgage rates ranged from 4.82% to 6.25% on October 16.
The rates rose after the COFIX benchmark increased by 0.25 percentage points, its largest rise in three years and 10 months.
For a 400 million won, 30-year mortgage, the article estimates monthly payments would now exceed 2.1 million won at the lowest rate, up from 1.93 million won in January.
The article reports that 165 trillion won in mortgage balances are due for rate changes in the fourth quarter.
- Who
- Borrowers with variable-rate mortgages at South Korea’s five major banks.
- What
- Variable mortgage rate ceilings at four banks rose above 6%; Shinhan Bank’s ceiling remained below 6%.
- When
- Rates were reported on October 16, 2026.
- Where
- South Korea.
- Why
- The COFIX benchmark rose by 0.25 percentage points, prompting banks to raise variable mortgage rates.
This story does not have two clearly opposing sides.
The five banks’ six-month variable mortgage rates ranged from 4.1% to 5.64%.
COFIX rose by 0.25 percentage points, its largest increase in three years and 10 months.
The five banks’ six-month variable mortgage rates ranged from 4.82% to 6.25%.
- Banks with variable-rate ceilings above 6%
- KB Kookmin, Hana, Woori and NH Nonghyup
- Shinhan Bank variable mortgage rate range
- 4.36%–5.77%
- Five banks’ six-month variable mortgage rates on October 16
- 4.82%–6.25%
- COFIX increase
- 0.25 percentage points
- Mortgages due for rate changes in the fourth quarter
- 165 trillion won
1 source
What people are saying
The Bank of Korea’s base-rate increase is a matter of timing. I expect another rate increase within the year.
However, if rates are raised too much, financial distress could increase and the stock and property markets could falter.