Lender's Mortgage Insurance (or LMI)
Banks will insure their loans at different risk levels, and as a general rule, they will pass part of the costs onto the customer once the loans goes beyond 80% Loan Value Ratio [LVR]. In other words, once the loan goes past 80% of the value of the home.
This is not the customer's insurance, it is the Lender's Mortgage Insurance.
There are some lenders that will recognise lower risk industries and will only pass on the Mortgage Insurance at 90% LVR.
In most cases, the banks will allow the Lender's Mortgage Insurance to be added to the loan as long as the total loan amount stays below 90% LVR.
There are some lenders that will allow Lender's Mortgage Insurance to be added to the loan as long as the LVR does not go beyond 97% LVR.
Call us today at Mortgage Choice Joondalup & Clarkson on (08) 9485 0090 and we will provide you with a number of choices that best suit your home loan needs.
Dennis Aplin, Your Local Mortgage Broker
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