LMI Lets Me In
Let more clients in with Lenders Mortgage Insurance (LMI).
LMI Lets Me In
Let more clients in with Lenders Mortgage Insurance (LMI).
With rising property prices and cost of living making home ownership more challenging than ever, savvy mortgage brokers are recognising Lenders Mortgage Insurance (LMI) as a way to help more clients achieve their home ownership goals and get ahead in today’s market.
Not just for first home buyers, LMI helps brokers service a larger client base by offering a flexible and competitive solution for all home buyers, whether they’re looking to upgrade, refinance or invest. By recommending LMI sooner in client conversations, brokers may be able to unlock better home ownership opportunities for more clients.
When comparing LMI as a fee versus the cost of delaying entry into the property market, the data is clear: LMI accelerates long-term financial wellbeing.
On average, home buyers who have used LMI have grown their equity by an additional
$107,000
within 5 years*
On average, home buyers who have used LMI were able to enter the market up to
9 years
sooner**
More than
80%
of home buyers would have been financially better off after 5 years by using LMI (rather than waiting to save a 20% deposit)**
*This outcome is based on Helia internal data for properties purchased using Helia’s LMI between 2014 to 2019 across all Australian States and Territories. The average additional equity growth is the increase in the value of the portfolio over a 5 year period following purchase.
**Helia: internal data analysis, LMI data from 2010 to 2023.
First home buyers
Help your clients stop renting and start owning sooner with LMI. Using LMI, home buyers can enter the property market with a deposit as little as 5% (plus additional upfront costs such as stamp duty), subject to satisfying your lender’s eligibility criteria.
Upgraders
With LMI, home buyers looking to upgrade don’t need to compromise on their next home - allowing them to purchase a bigger, better property. For refinancers, using LMI could unlock additional equity for renovations, debt consolidation or other investments.
Investors
For investors looking to purchase their first investment property or grow their existing portfolio, LMI allows earlier access to the market while potentially offering tax deductibility benefits.
the numbers
If your clients used LMI to purchase their home sooner in 2023, they could now be ahead by $72k if they bought a house and $32K if they bought a unit.
If your clients used LMI to purchase their home sooner in 2021, they could now be ahead by $649k if they bought a unit and $860K if they bought a house.
| - | 2023 | 2024 | Price change | Change inc. LMI |
|---|---|---|---|---|
|
House
|
$776k | $860k | +$85k | +$72k |
| LMI paid in '23 - $12,352 | ||||
|
Unit
|
$607k | $649k | +$42k | +$32k |
| LMI paid in ‘23 - $9,671 | ||||
 House |
|
| 2023 | 2024 |
| $776k | $860k |
| LMI paid in '23 - $12,352 | |
| Price change | Change inc. LMI |
| +$85k | +$72k |
 Unit |
|
| 2023 | 2024 |
| $607k | $649k |
| LMI paid in '23 - $9,671 | |
| Price change | Change inc. LMI |
| +$42k | +$32k |
Source: Property values at July 2023 and July 2024 based on CoreLogic Hedonic Home Price Index. LMI fee calculations assume a loan term of 30 years, LVR of 87% and LMI fee of 1.83%. LMI fee is paid at the commencement of the loan and is paid once for the entire loan period. Note: Totals may not sum due to rounding.
Disclaimer: The information contained is general information. It does not constitute legal, tax, credit or financial advice and is not tailored to an individual’s circumstances. Borrowers should consider their own personal circumstances and obtain professional advice before making any decisions that may affect their financial situation. LMI fee rates may change for investor scenarios. Past performance is no indication of future performance. LMI is capitalised into the loan. The LMI fee may vary depending on a range of factors including, the loan purpose, borrower amount and the security type.
Helia Insurance Pty Limited’s (“Helia”) credit activities are limited to credit activities engaged by it as an assignee in relation to providing Lenders Mortgage Insurance (LMI ) products or as a credit provider under the doctrine of subrogation in relation to providing LMI products. LMI is insurance that protects credit providers, not home buyers, and cannot be provided directly to home buyers. The information provided in this graphic does not refer to credit contract with any particular provider.
“When we needed a bigger
home to fit our growing family, our broker suggested we consider LMI. We’re so grateful they did.”
-Jaksen and Mia,
upsizers
Try the Deposit Comparison Estimator and help your clients get in sooner
Show your clients how their deposit stacks up. Use the Deposit Comparison Estimator to quickly compare options and unlock more opportunities to let them in.
