Lenders Mortgage Insurance (LMI)

 

What is LMI?

Depending on your funder’s requirements, Lenders Mortgage Insurance allows you to borrow up to 95% of the purchase price of your home, with a much lower deposit than is normally required. Lenders Mortgage Insurance (LMI) can be one of the most popular ways to achieve the dream of home ownership sooner for borrowers who do not have a large deposit. Many lending institutions require borrowers to contribute a 20% deposit. However, by utilising lender mortgage insurance with the right lender, borrowers are finding home ownership is well within their reach.

Lenders Mortgage insurance should not be mistaken for Mortgage Protection Insurance, which covers your mortgage in the event of death, sickness, unemployment or disability. If you require Mortgage Protection Insurance please follow this link to talk with us.

How does Lenders Mortgage Insurance benefit me?

With a small deposit even a 3% deposit you can purchase a home sooner and depending on the appropriate lender can capitalise (add) the mortgage insurance into your loan amount which should not exceed 100% of the purchase price of the property. These benefits are available to home buyers and investors.

Best Lenders for Lenders Mortgage Insurance?

Insurance premium costs vary from lender to lender and also fluctuate from month to month due to special exclusive offers available through each lender. Lenders will reduce LMI premiums to entice borrowers to apply.
For further details on LMI discounts follow this link to No Mortgage Insurance or Reduced Mortgage Insurance.
 

How do I obtain Lenders Mortgage Insurance?

We will advise you if you require lenders mortgage insurance and the lender will prepare all the necessary documents with the mortgage insurer to facilitate the mortgage insurance transaction.

Who is Insured?

Lenders mortgage insurance actually insures the lender. The lender is insured by the insurance policy, not you the borrower or your guarantor, who is covered by lenders mortgage insurance. This type of cover, Lenders Mortgage Insurance, protects the lender in the event that the property is sold and there is residual balance of debt owing.

What costs are involved?

As with all traditional insurance products lenders mortgage insurance is a once only insurance premium, payable at loan settlement which provides the lender with insurance cover for the full term (life) of the loan. We can calculate the premium by taking into consideration the size of your deposit and the type of loan product you choose. By capitalising the lenders mortgage insurance into the loan can reduce the upfront costs if a minimum deposit is available.

What types of loans are insured?

The mortgage insurer will provide Lenders Mortgage Insurance for majority of residential loans. These can comprise of residential owner occupier loans and residential investment loans.

Is the Insurance Premium refundable?

A partial refund of the insurance premium may be applicable if the loan is repaid within the first 2 years. The funder will provide further details should you repay or refinance the loan within this timeframe.

What do I do if I can’t make my mortgage repayments?

If you have a facility with or without lenders mortgage insurance and you are experiencing financial difficulties, contact us or your lender immediately.

 

You must contact us the moment you believe you will not be able to meet you loan repayments. Most importantly, it is in your interests, the lender and the mortgage insurer to work with you to determine a viable resolution that keeps you in your home with a workable solution to meet the loan repayments.

Genworth LMI Premium Estimator Calculator

Genworth have created a premium estimator to give you an indication of the LMI fee payable.

Click on the LMI Premium Calculator image to open the LMI Calculator.

Should I Buy Now or Wait & Save my Deposit?

Ultimately this decision is entirely up to each individual & each borrower to make.

Questions to consider:

If we take for example a property purchase of $500,000, 20 percent required is $100,000.

• On your present income, how much do you need to save per year to accumulate the 20 percent deposit or $100,000? 
• Depending on the house and the suburb of interest to purchase in, by the time you save the 20 percent deposit, what percentage will that house or suburb climb in value 2, 5, 10 or 15 percent?

Click on the Buy Now or Wait Calculator image to open the Calculator.

I’m ready to Apply.

Enquire Now to learn more, how to save yourself time and money on Lender Mortgage Insurance. Click on"Enquire Now" and we'll call you back to discuss your needs.