Hi Nyungen and welcome to the forum.
Yes, you might have to pay a premium for your home loan, which is called Lenders Mortgage Insurance(LMI).
As a general rule, LMI is applicable if you are borrowing more than 80% of the property value or 80% Loan to Value Ratio (LVR). For example, if a house is worth $100,000 and you want a loan of more than $80,000 then you will have to pay for LMI. This happens because a lender would want to be insured for the risk it is taking while giving out that loan to you.
Also, note that you will have the Lenders Mortgage Insurance premium deducted from the loan funds when they are advanced. For example, if you borrow $100,000 and the LMI premium is $5,000, then when your loan is advanced you’ll receive $95,000.
You can estimate the LMI with the help of ourLMI Calculator and find out yourself how much the LMI may cost if your LVR is greater than 80%.
We can be reached on 1300 889 743 or you can fill in free assessment form to see if you qualify for a loan or not.
Cheers,
What is a lenders mortgage insurance premium?
- Otto Dargan
- Mortgage Specialist
- Posts: 7730
- Joined: Sat Sep 06, 2008 5:55 pm
- Location: Sydney, Australia
- Contact:
- Otto Dargan
- Mortgage Specialist
- Posts: 7730
- Joined: Sat Sep 06, 2008 5:55 pm
- Location: Sydney, Australia
- Contact:
Re: What is a lenders mortgage insurance premium?
Hi Nyungen,
Our LMI calculator can help you calculate and compare the premiums of several mortgage insurers that are used by the major banks.
Due to limitations imposed upon us by lenders, we can’t publish their names alongside their quoted LMI premiums. They will simply appear as ‘Lender 1’, ‘Lender 2’, etc.
Apart from NAB and Westpac, included in the LMI calculator are:
Cheers,
Our LMI calculator can help you calculate and compare the premiums of several mortgage insurers that are used by the major banks.
Due to limitations imposed upon us by lenders, we can’t publish their names alongside their quoted LMI premiums. They will simply appear as ‘Lender 1’, ‘Lender 2’, etc.
Apart from NAB and Westpac, included in the LMI calculator are:
- ANZ LMI
- Arch Capital LMI
- CBA LMI
- Genworth LMI
- ING Reduced Equity Fee (REF)
- St George Insurance (SGI)
- QBE LMI.
Cheers,