Hello,
I am hoping someone could give me a guideline formula as to LMI.
I am researching for a IP and have set up a spreadsheet but am having trouble determining how much to put in the LMI column. i.e. 2% of the total loan amount or 6% etc.
My bank manager says she can get quotes for me but its a bit of a pain in the butt as at this stage I am working out if I want o purchase a home in low $200k or low $300k.
When doing calcs in my head I allow 2% of borrowings.
The actual figure will depend on final LVR – higher the LVR = the higher the LMI premium.
On top of this you also need to allow around 5% of purchase price for stamp duty, solicitors fees, bank fees etc etc etc.
Numbers are rough but they work for me.
Hi Intrigue
Firstly ask your Bank manager which mortgage insurer they use.
As a guide you can look on the Genworth website http://www.genworth.com.au/ and this will certainly give you a good estimation but remember each lender has slightly different scales and in some cases there are the odd one or 2 lenders who charge a fee or similar instead and this could be considerably cheaper than LMI as long as you fit the criteria.
Of course your Bank is not going to tell you that.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
http://www.nab.com.au/wps/wcm/connect/nab/nab/home/personal_finance/1/4/1/1
Not sure if this link works from my iPhone, but on the NAB website, do a search for the buying costs calculator. It works out LMI based on the amount you punch in. I wouldn’t say it’s gospel, but good for doing close estimation of purchasing costs.
pinkboy
pinkboy no you are correct certainly not gospel.
Gemworth calculator will give you a broader base level.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
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