First-Home Buyer Listing Series #1
If you’re buying under $1 million without a 20% deposit, Lenders Mortgage Insurance (LMI) may apply.
On a $950,000 purchase with around $180,000 in savings, your base loan may be approximately $831,000. LMI, often around $15,000 depending on the lender, is usually capitalised onto the loan.
This increases your total loan to roughly $846,000 and results in a higher loan-to-value ratio.
Understanding how LMI is calculated helps you choose the right lender and avoid surprises.
About author
Shehan Wijayasinghe
Accounting
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