장기 연체자 대출(Seoul = Yonhap News) Reporter Kim Nam-kwon = The Financial Services Commission announced on the 17th that it would additionally cancel the bonds of 118,000 long-term small delinquent borrowers (KRW 600 billion).
Accordingly, the number of debtors for bond cancellation increases to 291,000 (KRW 1.5 trillion).
A long-term small delinquent person refers to a debtor who has not been able to repay a ‘living small debt’ with a principal amount of 10 million won or less for more than 10 years.
In November 2017, the financial authorities announced a debt consolidation plan through a repayment ability review to support the rapid recovery of long-term small delinquent borrowers.
Debt adjustment organizations such as the National Happiness Fund will examine the borrower’s ability to repay long-term small delinquent receivables, and if the borrower is unable to repay, collection will be stopped and the receivables will be incinerated after three years.
After the announcement of the plan, the government stopped collecting debts from 335,000 (KRW 1.6 trillion) of the 403,000 borrowers who had been delinquent on their payments for more than 10 years and who were judged to be unable to repay.
Among these, 173,000 people (KRW 900 billion) of long-term, small delinquent receivables have already been canceled due to the completion of the statute of limitations and the court’s decision to exempt them from liability.
Of the 162,000 delinquent borrowers (KRW 700 billion) remaining in the National Happiness Fund, 118,000 (KRW 600 billion) of the bonds will be canceled this time.
The incineration will be finalized through a resolution by the National Happiness Fund Board of Directors on the 18th.
The remaining 44,000 people (KRW 100 billion) are delinquent borrowers who require additional screening of their ability to repay, such as verifying their assets after collection stops.
An official from the Financial Services Commission said, “The bonds (44,000 people) excluded from this burn will also undergo a final repayment ability review and if they are unable to repay, they will be burned at the end of the year.”
The cancellation of bonds does not have a direct effect on the smooth issuance of cards or loans for delinquent borrowers.
If a delinquent receivable exceeds 7 years, the delinquent information disappears from the list of credit information companies (CB), so in principle, financial activities are possible for long-term (10 years) small delinquent delinquent borrowers.
However, it is true that long-term small delinquent borrowers have low credit and low income, so there are practical limitations in receiving credit cards and loans.
This is because to be classified as a long-term small delinquent person, you must have no recoverable assets and must make less than 60% of the median income (monthly income of 990,000 won for a single-person household).
An official from the Financial Services Commission said, “The cancellation of bonds does not mean that your credit score will increase much, but it is important that it means that you have escaped long-term delinquency and laid the foundation for a comeback.”
An official at the National Happiness Fund explained, “The cancellation of bonds means that the National Happiness Fund will no longer manage delinquent borrowers as creditors,” and explained, “Delinquent borrowers can escape from concerns about seizure of wages, personal assets, bank accounts, etc., and anxiety about collection.” .
The cancellation of bonds will be determined from July 1 through the Korea Asset Management Corporation’s ‘On Credit (www.oncredit.or.kr)’ website, Korea Credit Information Service’s ‘Credit 4u (www.credit4u.or.kr)’ website, or Customer Support Center ( You can check it at ☎1588-3570).
The financial authorities plan to continue supporting long-term small delinquent borrowers from financial companies other than the National Happiness Fund.
An official from the Financial Services Commission said, “In the case of long-term small delinquent receivables held by financial companies, we received applications (February 2018 to February 2019) and purchased the bonds (9,000 people, 35 billion won) from the Long-term Small Delinquent Delinquent Support Foundation and stopped collection.” He said, “We will carry out incineration measures sequentially starting in the second half of this year, three years after the collection was stopped.”
kong79@yna.co.kr
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