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A falling debt ratio does not mean your loan repayments will fall. South Korea's household debt ratio is estimated at about 81.3% for the end of the second quarter of 2026 because nominal GDP grew faster than debt. The figure remains an estimate based on combined statistics.   Why a lower ratio can accompany more debt Estimated debt reached about 2,404.9 trillion won at the end of the second quarter of 2026, up about 30.8 trillion won from the previous quarter. Nominal GDP, the value of economic output at current prices, grew faster over the comparison period. For you, the useful distinction is between debt relative to the economy and the payments a household must make. The estimate is 1.3 percentage points above the government's target of around 80% by 2030. That target does not guarantee affordable repayments or automatically change lending terms.   Understanding Korea's debt estimate In the original article on Injoys, you can trace the estimate through a figures...

This content applies specifically to South Korea. A Bank of Korea base rate increase does not raise an existing loan rate the next day. For a variable loan, any change arrives on the contractual 3-, 6-, or 12-month repricing date; fully fixed rates are generally maintained until maturity, while hybrid loans become exposed after their fixed-rate period ends. The confusing part is that the central bank rate may not appear directly in your loan formula. The contractual benchmark, spread, and preferential discount can each affect the final rate.   What actually determines the next rate The basic formula is benchmark rate + spread - preferential rate . Benchmarks can include COFIX, bank bond yields, CDs, or KORIBOR. COFIX reflects bank funding costs in South Korea, while preferential discounts may depend on salary deposits, card spending, or automatic transfers. Variable loan: the new benchmark is applied at the next reset. Hybrid loan: the relevant benchmark matters when t...