Small-Deposit Tenants’ Right to First-Priority Payment: Requirements and Distribution Process

Based on 51 consultation cases · Updated October 4, 2026 · Translated from the Korean original.

If small-deposit tenants meet the prescribed requirements, they may receive repayment of a specified portion of their deposit ahead of holders of senior-ranking security rights. The applicable deposit thresholds and repayment amounts vary depending on factors such as the region and when the security right was acquired. To receive a distribution in an auction, tenants must file a demand for distribution by the prescribed deadline.

People involved → Tenant → Senior security-right holder → Auction purchaser → Tenant seeks deposit repayment from auction proceeds → Delivery and resident registration completed before auction application? → Yes · Housing Lease Protection Act Articles 8(1) and 3(1) → Deposit within the applicable small-deposit threshold? → No → Yes · Enforcement Decree Supplementary Provisions Article 2 → Demand for distribution filed by the deadline? → Yes · Civil Execution Act Articles 84(1) and 88(1) → May receive a specified amount ahead of senior security rights → Check regional threshold and applicable decree version → Thresholds vary by region and may depend on when the security right arose → Check amount and distribution cap → Payment is not the whole deposit; it is limited to a specified amount and, in total, half the residence value → Keep the right until the deadline → Maintain possession and…

Key points

To claim the right to first-priority payment, the tenant must take delivery of the residence and complete resident registration before the application for auction is registered (Housing Lease Protection Act, Article 8(1) and Article 3(1) (주택임대차보호법 제8조 제1항, 제3조 제1항)).
The deposit limit for qualifying as a small-deposit tenant and the amount eligible for priority repayment vary by region. In relation to holders of security rights created before an amendment, the version of the Enforcement Decree in force when the security right was acquired may apply (Supplementary Provisions to the Enforcement Decree of the Housing Lease Protection Act, Article 2 (주택임대차보호법 시행령 부칙 제2조)).
The amount entitled to first-priority payment is not the entire deposit, but a specified amount set by the Enforcement Decree. If the total exceeds half the value of the residence, distribution is made within that limit (Housing Lease Protection Act, Article 8(3) (주택임대차보호법 제8조 제3항)).
The value of the residence does not mean only the sale price. It is based on the amount actually available for distribution, calculated by adding to the sale proceeds interest on the purchaser’s deposit through the distribution date and any forfeited deposits, and then deducting execution costs (Supreme Court Decision 2001Da8974, April 27, 2001).
A small-deposit tenant’s claim for return of the deposit is a claim for which a demand for distribution is required. The tenant must therefore file a report of the right and a demand for distribution by the deadline (Civil Execution Act, Article 84(1) and Article 88(1) (민사집행법 제84조 제1항, 제88조 제1항)).
To retain the right to first-priority payment, the tenant must maintain possession of the residence and resident registration until the deadline for filing demands for distribution. If the tenant must move before then, the example advises completing registration of the leasehold right before moving.
Where a tenant qualifies both as a small-deposit tenant and for priority repayment based on a fixed date, the first-priority payment amount is distributed first, and the remaining deposit is distributed according to the priority order established by the fixed dates (Supreme Court Decision 2007Da45562, November 15, 2007).
A tenant may not be protected as a small-deposit tenant if the primary purpose of the lease is to recover a claim ahead of holders of senior-ranking security rights, rather than to actually reside in or use the property (Supreme Court Decision 2001Da14733, May 8, 2001; Supreme Court Decision 2013Da62223, December 12, 2013).

Frequently asked questions

Q. What requirements must a small-deposit tenant meet to qualify for the right to first-priority payment?

You must take delivery of the residence and complete resident registration before the application for auction is registered. A fixed date is not essential in itself to qualify for the right to first-priority payment, but separate requirements must be met to claim priority repayment based on a fixed date for the portion of the deposit exceeding the amount entitled to first-priority payment.

Case 1, Case 2, Case 5, Case 6

Q. Where can I check the deposit thresholds and first-priority payment amounts for small-deposit tenants?

The thresholds differ by region, and the standards in an amended Enforcement Decree do not necessarily apply unchanged to all existing holders of security rights. You must check when the security right over the rental residence was created and which version of the Enforcement Decree applies. The amounts given in the example assume the Enforcement Decree in force at that time and should not be treated as current thresholds.

Case 1, Case 2, Case 3, Case 11

Q. Can a small-deposit tenant receive a distribution in an auction without filing a demand for distribution?

No. A claim for the return of a small deposit is a claim for which a demand for distribution is required, so a valid demand must be filed by the deadline for filing demands for distribution. A case is cited in which a tenant who was excluded from distribution for failing to file such a demand could not later claim that the amount distributed to a junior-ranking creditor be returned as unjust enrichment.

Case 5, Case 8, Case 20

Q. Can I move during the auction and retain my right to first-priority payment if I have filed a demand for distribution?

According to the example, the tenant must maintain possession of the residence and resident registration until the deadline for filing demands for distribution. If the tenant must move out before that deadline, the tenant should first complete registration of the leasehold right. The example also advises that maintaining the requirements for enforceability against third parties until the purchaser has paid the full sale price is the safer course, as the enforcement proceedings could be canceled.

Case 6, Case 8

Q. How is the distribution handled if the deposit is less than the total first-priority payment amounts for several small-deposit tenants?

If the total amount entitled to first-priority payment exceeds half the value of the residence, distribution is made within that limit. The example explains that if all tenants are entitled to the same amount, the amount is divided equally; if their entitlements differ, it is divided in proportion to each tenant’s eligible first-priority payment amount.

Case 9, Case 11

Q. Are deposits calculated separately when family members or friends rent different parts of the same residence?

If tenants in one residence live together as a household, they may be treated as a single tenant and their deposits combined. However, a close friendship or sharing a kitchen or bathroom does not, by itself, establish that they live together as a household. The closeness of their relationship as a shared living community and the economic ownership of the deposit, among other factors, must be considered.

Case 4, Case 14

Q. Can a small-deposit tenant who failed to file a demand for distribution assert the lease against the purchaser at auction?

A court decision holds that merely failing to file a demand for distribution does not mean that a tenant has waived the right to enforce the lease against third parties or the right to claim return of the deposit. Whether the tenant can enforce the lease against the purchaser may depend on the specific circumstances, including the existence of any senior-ranking rights. This does not replace the demand for distribution required to receive a distribution.

Case 13

Q. Can I qualify for the right to first-priority payment if I convert money I previously lent into a rental deposit?

The fact that an existing loan has been converted into a deposit does not, by itself, preclude enforceability against third parties or the right to first-priority payment. However, the tenant may not be protected if the primary purpose of the lease was to recover a claim ahead of a senior-ranking security interest, without any genuine intention to use the residence as a home, or if the lease was fictitious.

Case 7, Case 18, Case 24, Case 25

Q. Can I claim the right to first-priority payment if the residence and the land have different owners, or if only the land is auctioned?

The court decision cited in the example held that when land owned by the landlord at the time the lease was formed was later transferred to a third party, the tenant could still exercise the right to priority repayment against the proceeds of an auction of the land alone. The example explains that this may also apply when the land and the residence have different owners.

Case 12

Relevant laws

Housing Lease Protection Act, Article 1 (주택임대차보호법 제1조)
Housing Lease Protection Act, Article 2 (주택임대차보호법 제2조)
Housing Lease Protection Act, Article 3(1) (주택임대차보호법 제3조 제1항)
Housing Lease Protection Act, Article 3-2(2) (주택임대차보호법 제3조의2 제2항)
Housing Lease Protection Act, Article 8 (주택임대차보호법 제8조)
Enforcement Decree of the Housing Lease Protection Act, Article 3 (주택임대차보호법 시행령 제3조)
Enforcement Decree of the Housing Lease Protection Act, Article 4 (주택임대차보호법 시행령 제4조)
Enforcement Decree of the Housing Lease Protection Act, Article 10(2) and (4) (주택임대차보호법 시행령 제10조 제2항·제4항)
Enforcement Decree of the Housing Lease Protection Act, Article 11 (주택임대차보호법 시행령 제11조)
Supplementary Provisions to the Enforcement Decree of the Housing Lease Protection Act, Article 2 (주택임대차보호법 시행령 부칙 제2조)
Civil Execution Act, Article 84(1) (민사집행법 제84조 제1항)
Civil Execution Act, Article 88(1) (민사집행법 제88조 제1항)

Watch out for

Deposit thresholds and first-priority payment amounts may vary by region and by when the security right was acquired. Do not use past amounts given in an example as though they were current thresholds.
The court sets the deadline for filing demands for distribution. Check the deadline and file the demand on time. You must also maintain possession of the residence and resident registration until that deadline.
If the total amount entitled to first-priority payment exceeds half the value of the residence, tenants may not receive the full amounts they have claimed.
Tenants may not be protected as small-deposit tenants if the lease is intended to recover a claim rather than for actual residence, or if the lease is found to be fictitious.

Source cases

This guide was compiled by AI from the following Korea Legal Aid Corporation consultation cases (in Korean).

This guide is general legal information about Korean law, not legal advice for your situation. For a specific case, consult a lawyer or the Korea Legal Aid Corporation (call 132 in Korea).