LMI Calculator — Lenders Mortgage Insurance
Lenders Mortgage Insurance protects the lender — not you — when you borrow above 80% of a property's value. Premiums vary meaningfully between insurers and lenders; this estimator uses indicative industry bands to show the scale, and the sections below show the four legitimate ways to avoid the premium entirely.
Indicative bands only — actual premiums vary by insurer, lender, loan size and purpose, and can usually be capitalised into the loan. No LMI applies at 80% LVR or below.
Four legitimate ways to avoid LMI
1. The 20% deposit — the classic path; LVR at or under 80% pays nothing. 2. The First Home Guarantee — eligible first home buyers purchase with 5% and the government guarantee replaces LMI entirely, within price caps (see our FHB page). 3. A guarantor structure — family property security tops your effective deposit past 20%; guarantees can be limited and released once equity grows. 4. Profession waivers — selected lenders waive LMI to 90–95% LVR for doctors, dentists and certain other professionals (see professional packages).
When paying LMI is actually rational
LMI isn't always the villain: if prices in your target market are rising faster than you can save the remaining deposit, a capitalised premium can cost less than the wait. It's arithmetic, not ideology — we model buy-now-with-LMI against save-and-wait on your actual numbers, and read our guide to avoiding LMI for the full decision tree.
Frequently Asked Questions
- Is LMI a one-off or ongoing cost?
- One-off, paid at settlement — and usually capitalised into the loan, so it compounds quietly over the term. That compounding belongs in any honest comparison of paths.
- Does LMI protect me if I can't pay?
- No — it protects the lender against shortfall on default. You pay the premium; the cover is theirs. Your protections come from insurance you choose and the buffer built into sensible structuring.
- Can LMI be refunded if I refinance early?
- Occasionally partial refunds exist within the first 1–2 years, insurer-dependent — and a refinance at 80% LVR later never recovers premiums already paid. Another argument for choosing the right path first.
Turn the estimate into an answer
Calculators model arithmetic; lending runs on policy. A director will pressure-test your numbers against live lender policy — free, same business day.
Book Your Strategy Session or call 0401 333 636
Reviewed by Brian Hermosilla, Director — 20+ years in banking & finance · CR 485802 · MFAA #716100. Estimates only; not credit or financial advice.