According to the report by the Bank for International Settlements, the debt service ratio of the local household sector came to 12.5 percent in the January-March period.
It was up 0.7 percentage point from a year earlier and marked the highest level since the first quarter of 1999, when BIS started to compile related data.
The on-year increase was the largest among the 17 countries surveyed, while the first-quarter figure placed fifth highest.
The DSR measures the share of household income used to service debt. It's regarded as a reliable early warning indicator for a systemic banking crisis.
South Korean households' DSR had been on the rise since 2015 after the government softened regulations on the real estate sector.
The report also showed South Korea's household debt reaching 93 percent of its gross domestic product in the first quarter, the eighth highest in the world and the highest among 18 emerging economies.
The figure was up from 88.4 percent a year earlier, representing the second-fastest growth pace among the surveyed countries after China's 5.5 percentage-point increase.
Switzerland had the highest household debt-to-GDP ratio of 128.5 percent, trailed by Australia with 122 percent, according to the report.
South Korea has been dogged by snowballing household debt, which is estimated at 1,400 trillion won ($1.23 trillion) and could become a "time bomb" for Asia's fourth-largest economy.