What is Lenders' Mortgage Insurance?
Lenders' Mortgage Insurance (LMI) is a premium you pay on your home loan if your deposit isn’t large enough for the property you wish to buy. With the support of LMI, we may be able to accept a smaller deposit and provide a home loan to you that might not otherwise be available.
It’s important to understand that LMI protects the lender (not you, the borrower) from financial loss if you cannot repay your loan.
Example:
Say you want to buy a house that’s worth $600,000. Typically, you would have to save a deposit that is at least 20% of the property’s value which, in this case, would be $120,000.
If you’ve only saved $80,000 but have an income that can support the loan, you may be able to use Lenders' Mortgage Insurance to allow us to lend you the $520,000 you need to make the purchase.
Other borrowing options for low deposits.
Home Guarantee Scheme
The Home Guarantee Scheme (HGS) is an Australian Government initiative to help you buy or build your home sooner.
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Parent equity
An immediate family member can help you secure a home loan by using equity in their home as security.
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Buying your first home?
Now that's exciting! If you need a hand learning the lingo or understanding the home buying process, check out the guides, tools, FAQs, and calculators available on our first home buyer hub.
Saving for a deposit.
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