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  • Profile photo of StoreybuilderStoreybuilder
    Participant
    @storeybuilder
    Join Date: 2016
    Post Count: 45

    Hello investors!

    I’ve done a little bit of a look around and there seem to be some loans available at 95% still but not so many.

    My question is not whether you think 95% is good or not, just how available it is.

    Should I base my calculations on 90% instead?

    Also, does anyone know the current limit for total loans for LMI?

    Thanks

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,173

    These would be very hard to get, so best to assume 90% LVR.

    You can get LMI loans up to around $2mil.

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of Corey BattCorey Batt
    Participant
    @cjaysa
    Join Date: 2012
    Post Count: 1,010

    Yes they still exist, whether they’re of value is another question. Once you tick over 90%, LMI rises exponentially. It gets to the point for every reduction in $1 of deposit, you’re paying $1 in extra LMI – not a very good return on investment. 88-90% is ideal for investing, as it balances the ability to leverage as much as possible, whilst keeping costs constrained as much as practical. I’ve written about LMI for investors and the balance of what LVR to choose here: http://www.precisionfunding.com.au/lmi-friend-or-foe/

    Corey Batt | Precision Funding
    http://www.precisionfunding.com.au
    Email Me | Phone Me

    Investment Focused Finance Strategist - servicing Australia-wide

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    They exist but there aren’t many lenders doing them – and your application has to be very strong to overcome credit scoring and LMI.

    The costs of LMI at 95% is brutal too!

    For high LVR loans – generally best to stick with 88% + LMI in my opinion. Your scope of lender options improves – and the LMI costs drops a lot.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of StoreybuilderStoreybuilder
    Participant
    @storeybuilder
    Join Date: 2016
    Post Count: 45

    Hey thanks everyone,

    These are really good answers I appreciate it. I never realised how much more expensive LMI becomes. I’ll aim for 88%_90%.

    Profile photo of Colin RiceColin Rice
    Participant
    @fms
    Join Date: 2011
    Post Count: 338

    The only reason for a 95% loan would be lack of deposit.

    88% + LMI keeps it below 90% in most scenarios which opens up many more options and also lessens risk to bank so easier to get the green tick of approval.

    Colin Rice | CDR Finance
    http://cdrfinance.com.au/
    Email Me | Phone Me

    Perth Based Mortgage Broker - Investment Property Finance Specialist | E: [email protected]

    Profile photo of JerryJerry
    Participant
    @jerry_o
    Join Date: 2013
    Post Count: 46

    Which industry are you working in? There are lenders who waives LMI for certain professions such as CPAs, Medico Professionals etc.

    Jerry | Mortgage Station
    http://mortgagestation.com.au/
    Email Me | Phone Me

    Finance Strategist - Active Investor - Serving clients Australia-wide - Based in Sydney / Melbourne

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