LMI Calculator Australia — Lenders Mortgage Insurance

LMI Estimate

Loan amount$595,000.00
Loan-to-Value Ratio (LVR)85.0%
LMI applies?Yes (LVR > 80%)
Estimated LMI premium$3,451.00
Stamp duty on LMI premium$345.10
Total LMI cost$3,796.10

About LMI

LMI protects the lender (not you) if you default on your loan. It is required when your deposit is less than 20% of the property value (LVR above 80%).

LMI premiums shown are approximate estimates based on published insurer rates (Helia/Arch MI). Your actual premium will depend on your lender and LMI insurer. The premium can usually be added to your loan (capitalised). Source: Helia (helia.com.au).

First home buyers may qualify for LMI waivers through the First Home Guarantee (FHBG), which allows eligible buyers to purchase with a 5% deposit and no LMI. Source: Housing Australia (housingaustralia.gov.au).

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Frequently Asked Questions

What is LMI (Lenders Mortgage Insurance)?

LMI is insurance that a lender takes out to protect themselves if a borrower defaults on their home loan. It is required when the borrower's deposit is less than 20% of the property value (LVR above 80%). Importantly, LMI protects the bank, not you. Source: Helia (helia.com.au).

How do I avoid paying LMI?

The main ways to avoid LMI are: save a 20% deposit; use a guarantor (family guarantee loan); use a government scheme like the First Home Guarantee (5% deposit, no LMI for eligible first home buyers); or be a medical professional (some lenders waive LMI for doctors, dentists, etc.). Source: Housing Australia (housingaustralia.gov.au).

Can LMI be added to my loan?

Yes. Most lenders allow you to capitalise (add) the LMI premium to your loan balance instead of paying it upfront. This means you pay interest on the LMI premium over the life of the loan.

Is LMI tax deductible?

For investment properties, LMI may be tax deductible over 5 years or the loan term (whichever is shorter). For owner-occupied properties, LMI is not tax deductible. Source: ATO (ato.gov.au).

What is the First Home Guarantee?

The First Home Guarantee (FHBG) is a government scheme that allows eligible first home buyers to purchase a property with a deposit as low as 5% without paying LMI. The government guarantees up to 15% of the loan value. Source: Housing Australia (housingaustralia.gov.au/first-home-guarantee).