I further query the loan provider, they have additional Mortgage Insurance policy adjustment fee $670 for the top-up on top of that $1300, even thou in the end the total amount of the loan (existing+top-up) is not over 80% of the valuation.
I did pay my LMI when I took the original loan, but my logic says when the loan is less than 80% of the valuation, this is not needed anymore.

Can anyone enlighten me on this ? I'm worry that the bank is just making it up.

Thank you.

Thanks Terryw for your reply. You're absolutely right, that things may changed in the future, and what ever I decided may not be suitable for the long run. I never heard about discretionary trust, what is this and how does this actually works ?.

Just out of curiosity, out of this two scenario which one is better, more tax deduction with higher CGT or less tax deduction and less  CGT ? I don't have experience on this. anyone have the numbers to compare ?

Thanks.

Thanks Michael and Richard, surely your discussion are very informative and have benefited me.
I'll have to re-read them again and again tho, to digest them completely, as I'm not very familiar with a lot of the terms.

Just to clarify my understanding about my offset account. To me I don't actually earn interest from my money/funds in my offset account, that's why I don't have to pay tax on those interest because I never earned them. However, the total amount of that offset account will reduced/offset the total amount of my loan daily, hence the interest charged is only to the remaining amount in the loan account.
For example : My loan is 360K and I have 100K in my offset, the interest is only charged on the 250K, I think because the lender consider that I borrow 100K less. Is my understanding correct ?

Michael, is there any tools or service that I can use to check if they have offset my account correctly ?
Since I have this loan and offset account, I trusted the calculation 100% to ratebuster or maybe firstmac. so, I thought everything will always be fine.

Is being ADI lender make a lot of different to a borrower like me ?

You are right Michael, that I don't have robust plan, or even the capability to plan it myself. so far I just work to earn my money and put my money in my offset account to reduced my loan interest charged that's all, nothing more, it's just recently I am interested to see what other people do with their money and I come to see this website.

do you have any real professional, non-commission based financial planner that you can recommend to me ?

Sure I'll get Scott's book and also read your article in edition 26 next month (never read magazine so far).

Thanks.

I've spoken to the lender. they said they can do it for $1300

From what I can think of is I have two options now for this equity access without selling the PPOR.
And I also have a couple of question in regards to both.

1.Pay $1300 to the lender and get 80K if I borrow 80% and no LMI paid or pay LMI and borrow up to 90% or over.

   I actually paid LMI for the 30 years term of the first loan as I borrowed 98%.
   Can anyone enlighten me  If I am going to borrow 90% of the house value now, do I have to pay a new LMI against 495K or just the different between 495K and 360K which is 135K.

Is it worth for me to pay the LMI and get 90% or am I better off just borrow 80% and avoid the LMI ?

2.Bite the bullet and pay the exit fees which is $2880 + $600 processing fees and refinance with other lender.
    My current rate is 4.87 shich I think quite good. but I may be wrong.
any recomendation of lender/banks ?

What do you all think about my situation, any comments would be very helpfull.

Thanks.