Korea Loan Calculator Bank of Korea ECOS · 2026.05
Korea loan calculator for any Korean mortgage or credit loan in KRW. Korean banks use Equal Payment (원리금균등) as default — same method as a US 30-year fixed mortgage. Compare side-by-side with Equal Principal (원금균등) and view a 240-row amortization schedule with principal vs interest breakdown.
🌐 Korea vs Other Countries
- Korea: Equal Payment (75%) standard · Equal Principal (25%) · Interest-Only rare
- USA: 30-year fixed mortgage = Equal Payment (US standard, ~95%)
- UK: Mostly Equal Payment ("repayment mortgage") with shorter fixed-rate periods
- Germany / France: Both methods coexist; "Annuitätendarlehen" = Equal Payment, "Tilgungsdarlehen" = Equal Principal
- Japan: Both methods offered; Equal Payment more common for fixed-rate "Flat 35"
- DSR: Debt Service Ratio ≤ 40% of annual income (banks). 2026 Stress DSR Phase 3 adds +1.5% buffer rate
- LTV: Loan-to-Value ≤ 70% of property price (50% in Seoul metro, special zones differ)
- Foreigner factors: Visa term, ARC validity, employment proof, FX risk
Calculation Method
- Equal Payment (원리금균등):
PMT = P × r / (1 − (1+r)^−n)
P = principal, r = monthly rate (= annual / 12), n = total months. Same monthly amount throughout. r=0 fallback: PMT = P/n - Equal Principal (원금균등): monthly principal = P/n, monthly interest = balance × r → first month heavier, declining over time
- Interest-Only (만기일시): monthly = P × r (interest only), balloon repayment of full principal at maturity
- Grace period (거치기간): interest-only during grace, then formula applies to remaining (n − grace) months → total interest increases
- Last-month rounding: floating-point accumulation → final month's principal = prior balance, ensures balance = 0
Korean market rates (May 2026, BoK ECOS): Variable mortgage 4.34%, credit loan 3.85–5.53%, policy loans (Bogeumjari, Didimdol) 3.7–4.4%. This calculator uses fixed-rate scenarios; variable rates require recalculation at each rate-reset date.
FAQ
What's the difference between Equal Payment and Equal Principal?
Equal Payment (원리금균등) means the same total monthly payment throughout the loan — interest-heavy at first, principal-heavy later. Equal Principal (원금균등) means the same principal amount every month plus declining interest — heavier upfront but lower total interest. US-style 30-year fixed mortgages are Equal Payment.
Which is more common in Korea?
Equal Payment is the default for ~75% of Korean home loans. Equal Principal is offered but less popular due to higher initial payments. Interest-Only is rare except for short-term bridge loans or rollover-style products.
Can foreigners get Korean home loans?
Yes, with F-2/F-5/F-6 visas (and recently some F-4) you can apply for mortgages. Exchange rate risk and shorter visa terms may affect approval. Major banks like KB, Shinhan, Hana, and Woori all offer English support and have foreigner-friendly home loan products. Bring your ARC, employment proof, and income documentation.
How is interest calculated — daily or monthly?
Korean banks typically use the 30/360 method (each month = 30 days, year = 360). Monthly rate = annual rate / 12. Some products use Act/365 for daily-accrual products. This calculator assumes the standard 30/360 monthly compounding, which matches most Korean home loan amortization schedules.
What is DSR and how does it limit my loan?
DSR (Debt Service Ratio) caps your annual loan repayment at 40% of annual income for bank loans, 50% for non-bank lenders. Since 2026, Stress DSR Phase 3 adds a +1.5% buffer rate to your loan rate when calculating eligibility, effectively reducing your maximum loan amount by ~15%. The buffer is for risk simulation — your actual interest rate stays the same.