LMI or Lender Mortgage Insurance is the fee charged to the banks by their underwriters. It is used as a risk management device that allows banks to lend money above their normal lending guidelines, normally a Loan to Value ratio exceeds 80%. LMI is a fee that most banks do not profit from. As it is a fee charged to them, they simply pass it on to the customer.
The customer then has the decision on whether they wish to pay the LMI premium upfront, or alternatively capitalise the amount on top of their loan.
At Mortgage Choice Coolangatta, we are able to accurately estimate any LMI fees that may be applicable to your specific enquiry and we will also give you tailored advice on how to go about paying it.
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