How To Reduce Lenders Mortgage Insurance (LMI)

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How To Reduce Lenders Mortgage Insurance (LMI)

Lenders Mortgage Insurance can be a great tool to help homebuyers get into a property that they otherwise might not be able to afford. However, it comes with a cost.

LMI is a one-off insurance premium that is put in place to protect the lender in the event the borrower is unable to manage their repayments. For many loans, LMI can add a significant upfront cost. LMI is normally applicable when a borrower is seeking to get a loan with an LVR of more than 80 per cent.

Using LMI can be a very valuable tool for many homebuyers, as it might allow you to purchase a property years ahead of when you might have otherwise. You’ll be buying a property in today’s dollars and can benefit from any capital growth, instead of being required to pay a higher price at a later point. If you are required to pay LMI, there are some ways you can potentially reduce the cost.



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