I am currently looking to refinance my POPR to accommodate a bit of renovating and debt consolidation, however had a few minor dramas with our valuation. I have read the threads on low valuations and found some good advice however, I have been told that if I change lenders, I may have to pay the full LMI again. I was also told that I may get a discount on that amount as I have already paid, although it may only be up to 40% discount. I am more than willing to pay additional LMI if necessary to get where I want, however, to pay the whole amount seems a bit extreme.
Does anyone have experience in this? I would really appreciate some insight!
Hi Jhopper,
If you refinance under 80% LVR you may not incur LMI.
You may also be entitled to a refund on a portion of the current LMI, subject to the length of loan and credit policy.Regards
Steven
Mortgage Broker[email protected]
http://www.mobilemortgagemarket.com.au
Ph:0402483216
Ph:1800 820 500
VICTORIAPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
hi, finance is basically math ok?
how much is it worth?
how much do you owe?
how much do you want to borrow?
who are you with now?
what do you earn?
how long have you owned it?brahms
broker
[email protected]Thanks for the responses Brahams and Steven,
The basic issue is as follows:
Owe $360k
valuation $435
need $45k for debt consolidation/car/renovations
therefore based on above we are borrowing 93%originally (10months ago) we borrowed 95% so incurred the LMI at a princely sum. We were told that, through our lender which is Bank West, we would need to top up the LMI at a cost of around $500 which is acceptable. This was based on a higher valuation of $460K (borrowing 88%).
The real problem comes down to the low valuation so we are looking at different lenders. I think I understand the maths and know there are exit costs for changing lenders, however, is there additional LMI costs if you change lenders. I wouldn’t think so but have been told yes???
Thanks again.
Hi Jhopper,
If you do refinance you will incur Mortgage Insurance again.If you need 93% LVR, then you may want to consider a Lending Institution who will capitalise the LMI into the loan,
Keep in mind, if you do refinance you may be entitled to a refund on a portion of the LMI from the previous lender.Regards
Steven
Mortgage Broker[email protected]
http://www.mobilemortgagemarket.com.au
Ph:0402483216
Ph:1800 820 500
VICTORIAPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Thanks Steven, I think that was the answer I was searching for. Bankwest do capitalise the LMI which we did the first time, however what my broker may have been talking about was changing lenders and not being able to do so. He didn’t actually say that but may have been what he was going on about.
Feel like a bit of a nimrod for asking stupid questions but got the answer. Thanks again!!
It will be very hard to refinance at more than 90% LVR. With ANZ you can go up to 95% on a refinance as long as you do not increase the loan. ANZ also allows you to capitalise the LMI. Another benefit with ANZ is that the broker can order the valution before submission, so you can pull out if it comes in low – with no cost or CRAA check.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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