New law passed in South Korea to prevent charter fraud

In Korea, there is a special system called jeonse when renting a house. It is not a monthly fee, but a large amount (deposit) of 50 to 90% of the house price, and not paid after that.

Of course, when you leave the house, you get your deposit back in full. From the tenant's point of view, if you pay the monthly rent, all the money disappears, but the jeonse does not disappear and can be returned, so many Koreans prefer the jeonse.

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Lease information must be disclosed

The problem has grown so much that a new law has been created in Korea to prevent charter fraud.

According to this law, when signing a lease contract in the future, the landlord must present the senior lease information and tax payment certificate to the tenant.

If there are several households in a house and there are several senior tenants already living in the house, it is very risky to pay a large jeonse deposit and live in that house.

Until now, it was difficult to clearly check the information of the senior tenants who entered before me, but from now on, the landlord must present the rental information and tax payment certificate, such as the seniority fixed date of the house, the date of grant, and the deposit, to the tenant.

This regulation is scheduled to come into effect from the date of promulgation of the law, and will apply from the lease contract concluded at the time of promulgation.

Contract void in case of false disclosure

The Ministry of Justice also decided to revise the ‘Standard Contract for Housing Lease’ to increase the effectiveness of the newly promulgated law.

In the new standard contract, if the landlord falsely provides senior lease information or it is confirmed that there are taxes not paid, the tenant can cancel the contract without penalty.

Foreign residents, when signing a lease contract in Korea, be sure to check the senior lease information and tax payment certificate presented by the lessor.

Of course, if you plan to rent a house on a monthly basis rather than a jeonse, you will be free from this burden.

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