What Is LMI

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http://youtube.com/watch?v=enAuO90wye4

http://www.homeloanexperts.com.au/len... • What is Lenders Mortgage Insurance when is it applicable to you? Find out how LMI works in Australia learn how to get approved • --------------------------------------------------------------------------------------- • Try our LMI Calculator to find out the cheapest LMI for your mortgage - http://www.homeloanexperts.com.au/len... • --------------------------------------------------------------------------------------- • This video was produced by Home Loan Experts. Visit us at http://www.homeloanexperts.com.au for more information. • Subscribe to our channel to learn more about home loans: / homeloanexperts • --------------------------------------------------------------------------------------- • Video transcript: • Wondering what Lenders Mortgage Insurance is? We walk you through how LMI works and how you can get the lowest LMI premiums for your home loan. • But first • Meet Will, • Will is looking to buy a new home for his family. • He has just found his dream home and has gone to the bank for a mortgage. As he applies for the loan, the banks slap him with a Lenders Mortgage Insurance premium! • Sounds familiar? • So what is Lenders Mortgage Insurance? • LMI is insurance that protects the lender in the event that you default on your home loan. It doesn't protect you as the borrower! • It is a once of insurance premium, payable when your loan is advanced. • For example, Will is looking to buy a house for $500,000. • If he were to borrow 90% of the property value, he would have to pay $8000 in Lender Mortgage insurance. • However, if Will were to borrow 95% of the property's' value, then he would have to pay $14,000 in lenders mortgage insurance. • The more you borrow, the higher your LMI premium. • The great news is, different LMI providers have different premium rates. This means that there can be thousands of dollars in difference, between the cheapest and most expensive LMI providers. • This is good news for Will. • Lenders Mortgage Insurance is only applicable if your loan poses a high risk to the bank. This is generally because you are borrowing over 80% of the property value. • So should Will buy now or save a larger deposit? What will be cheaper? • In most cases house prices will grow faster than your savings, so it is better to by sooner rather than later. • One other thing! • Did you know that if Will is a doctor or his parents guarantee his loan then he may have his LMI premium waived? It can potential save him thousands. • So can Will choose which mortgage insurer his bank uses? • No, lenders have agreements with just one or two insurers and cannot get any other insurers to approve your loan. • The great news is, by choosing your lender you choose which mortgage insurer your loan is insured through. This way you can reduce the cost of your LMI premium. • What is better is that lenders with lower LMI premiums also tend to have better interest rates as well! • This is great news for Will and great news for you. • Check out our LMI calculator to see what your premium is.

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