Overdue payments on South Korea's Bogeumjari Loan, a state-backed fixed-rate mortgage for low- and middle-income households and owner-occupier buyers, reached 548.9 billion won ($395 million) at the end of July. The balance was roughly five times the 110.4 billion won recorded at the end of 2021, while the overall delinquency rate rose to 0.47% from 0.13%. Borrowers earning 10 million won or less a year had a 1.01% delinquency rate, compared with 0.31% for those earning more than 70 million won. Long-term arrears also expanded sharply, with loans overdue by more than a year reaching 148.2 billion won, up from 38.4 billion won in 2020. The disparity cannot be explained simply by larger borrowing against home values: the average loan-to-value ratio for the lowest-income borrowers using 40- and 50-year terms was 51.3%, below the 67.9% recorded for the highest-income group. Analysts and officials linked the deterioration to weaker income and employment conditions, higher living costs, broader debt-servicing burdens and the economic slowdown. The Korea Housing Finance Corporation has raised Bogeumjari Loan rates five times this year, while market mortgage rates at the five largest banks have climbed to 4.94%-6.92%.