StoreybuilderParticipant@storeybuilderJoin Date: 2016Post Count: 45
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?
ThanksTerrywParticipant@terrywJoin Date: 2001Post Count: 16,110Corey BattParticipant@cjaysaJoin Date: 2012Post 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/Jamie MooreParticipant@jamie-mJoin Date: 2010Post Count: 5,065
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.
JamieStoreybuilderParticipant@storeybuilderJoin Date: 2016Post 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%.Colin RiceParticipant@fmsJoin Date: 2011Post 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.JerryParticipant@jerry_oJoin Date: 2013Post Count: 46
Which industry are you working in? There are lenders who waives LMI for certain professions such as CPAs, Medico Professionals etc.
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