80% or 90% LVR??

In Property Investing example the wrapper borrows 90% for the property. Figures are as follows:-

Purchase price – $80,000
Deposit – $8,000 (10%)
Closing costs – $2,500
Cash needed – $10,500
Loan – $72,000
Interest rate – 6.9%
Weekly repayment – $116.13

Wrapee’s
Purchase Price – $100,000
Deposit – $10,000
Closing cost – $500
Cash needed – $10,500
Loan – $90,000
Interest rate – 8.4%
Weekly repayment – $165.44

The sellers return is then ($165.44-$116.13)*52) = $2,564.34.

Considering is outlay was only $500 his C.O.C return is 512.87%.

First of all we cannot assume that every buyer has FHOG so if we take this out of the calculation the return is not as impressive.
We get the following $3000 deposit from buyer less wrappers initial investment of $10500. Total cash in deal is therefore $7000. C.O.C return is then 36%. No where near as impressive but still better then any managed fund.

We will take this a step further and borrow on the traditional LVR of 80%. Cash in deal is now $15,000. C.O.C. return is now as follows;
2564.34/15000 = 17% not so impressive but still better then negative gearing.

I’m by no means saying these deals can’t be done but before going into any deal you have to plan for what is not what might be eg. FHOG $7,000 this may not exist soon which will total diminish C.O.C return. You are also assuming that the purchaser is going to be a First home owner.

The main question I wanted to ask was that of LVR?? Do we borrow 80% or 90%. This can have a huge impact on C.O.C. return. In the above example he borrows 90% which would mean mortage insurance is a must. The cost of the insurance would then be added onto his cost which would diminish his C.O.C return.

Has anyone got any idea to the cost of mortgage insurance say on a $80,000 property approx??