Young professionals warned of illegal real estate contract practices

The Korea Real Estate Board has warned young professionals that writing contract amounts differing from actual transaction details or charging brokerage fees above legal limits violates the Licensed Real Estate Agents Act. Suspected illegal activities can be reported to the Integrated Reporting Center for Illegal Real Estate Practices via telephone or online.

When young professionals enter into their first Jeonse contracts, caution is required as contract amounts or brokerage fees may deviate from legal standards. It is essential to identify the types of illegal activities that can occur in actual contract settings and develop habits to verify details to prevent them.

Beware of false contracts and brokerage fees exceeding the legal limit

One of the most frequent illegal acts that can occur during the real estate contracting process is writing contract amounts that differ from the actual transaction details. For example, it is clearly illegal to write a contract with a higher amount than the actual contract price to increase loan limits, or to create two or more different transaction contracts for the same contractor. This violates Article 26, Paragraph 3 of the Licensed Real Estate Agents Act, which strictly prohibits recording contract details based on falsehoods that differ from the facts.

The method of calculating brokerage fees must also be carefully examined. Real estate agents must comply with the upper limit rates set by law, and requesting money or goods in excess of these limits, regardless of the justification provided, is illegal. In the field, cases may arise where fees exceeding the legal maximum are demanded under the pretext that "the property was shown specially" or "this is standard practice." This violates Article 33, Paragraph 1, Item 3 of the Licensed Real Estate Agents Act, and before concluding a contract, one must ensure that the brokerage fee to be borne is within the upper limit rate.

Use the 'Integrated Reporting Center for Illegal Real Estate Practices' if illegal activity is suspected

According to guidance provided by the Korea Real Estate Board, if illegal activity is suspected during the real estate contracting process, it can be reported through the Integrated Reporting Center for Illegal Real Estate Practices. The first step in preventing damage is the habit of meticulously checking contract contents and conditions before completing the signing of the contract.

When proceeding with a report, one must prepare all evidence that can prove the illegal act, such as the contract, conversation records, and transfer history, while simultaneously writing the details of the report and the subject of the report. Sufficient evidence must be secured to allow for a smooth investigation. Once a report is received, local governments conduct an investigation, after which a text message notifying the results is sent through the reporting center. Reporters can check the final processing results through the 'Real Estate Information Integrated Platform (Real Estate Information Site).'

The Integrated Reporting Center for Illegal Real Estate Practices operates through online reporting and telephone consultation (1644-9782). This campaign is being conducted jointly by the Ministry of Land, Infrastructure and Transport and the Korea Real Estate Board to establish a healthy real estate market order.

Source: original video (YouTube)