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Lenders' Mortgage Insurance [LMI] on Home Loans

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Hi

We plan to assist a much loved family member get the deposit together to purchase a house. They are currently renting.

My understanding is that, generally, a deposit of 20% is required to avoid very expensive LMI.

I am hoping, among the collective wisdom on ASF, that some subscribers may be able to point me towards reputable and cheaper [in terms of LMI] lenders.

Or perhaps there are completely different strategies we could use?

All and any advise would be appreciated.

Thank you

Rick
 

ROE

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Hi

We plan to assist a much loved family member get the deposit together to purchase a house. They are currently renting.

My understanding is that, generally, a deposit of 20% is required to avoid very expensive LMI.

I am hoping, among the collective wisdom on ASF, that some subscribers may be able to point me towards reputable and cheaper [in terms of LMI] lenders.

Or perhaps there are completely different strategies we could use?

All and any advise would be appreciated.

Thank you

Rick

Only two underwriter in LMI .. QBE and Genworth .. QBE is a stronger player and price risk better so they make
very good Return ... Genworth is a basket case so maybe go with them as they price their product cheaper and dont make profit :)

but I wouldn't bet on it now, I think both has move to up their premium in the last 12 months because both of them acknowledge Australia house price is overvalue and could be in for a correction...

they already facing mounting claim on this front and could be in for a bit of a loss so you can be sure premium wont be cheap
now they know house price do go down and can be devastating

some banks takes on the risk and self insure their LMI thinking they can make easy bucks without much risk, so again they can price cheaper....I know some regional banks do it so check with them.

Why not go the old fashion way like before? if you cant have 20% deposit saving chance are you cant afford the place...housing boom in the last 15 years, change people perspective on how they buy their house because they can always flip for profit...going forward 20% deposit is a better move...
 
Joined
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Is there any way that LMI can be avoided by someone (a parent ?) acting as guarantor to a home loan (or the LMI) without putting their own home up as the guarantee? I wouldn't mind doing that except for the fact that we are very close to selling and down sizing our own place....

Has anyone experienced this or a similar situation?
 
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