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Compare NAB LMI

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Home Loan Experts’ Review:
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Founded: NAB uses Genworth and QBE to insure their loans.

Lenders they support: NAB
NAB Broker (previously Homeside)

Max LVR: 95% LVR

LMI Capitalisation: 95% LVR (conditions apply)

LMI Premiums: Compare using our LMI calculator | See below for NAB’s LMI table

Like most other banks, National Australia Bank (NAB) doesn’t have its own Lenders Mortgage Insurance (LMI) provider.

However, from there it gets a little confusing since NAB use QBE for their own home loan applications and Genworth for NAB Broker applications.

The reason for this is largely because NAB and NAB Broker (which was originally set up as Homeside) each have their own products and interest rates.

NAB Broker is a broker-dedicated channel which means it’s really designed for lower risk clients such as those with a large deposit.

The normal NAB arm deals with customers direct. Ultimately, because NAB and NAB Broker have different appetites, two different LMI insurers are required.

How does NAB’s LMI compare?

They’re great at

But they’ve got some drawbacks…

  • They rarely capitalise LMI which means your home loan can end up being more expensive
  • If a home loan application fails credit scoring, it’s rare that it will be manually reviewed
  • There can be big differences between the assessment of two credit managers
  • There are higher interest rates for loans over 80% of the property value.

Talk to one of our expert mortgage brokers to find out if NAB is right for you.
Call us on 1300 889 743 or complete our free assessment form online.

Capitalising LMI makes a lot of sense

If you’re borrowing at 90% LVR with NAB then your LMI is deducted from your overall loan amount. So you may actually get 88.5% after you’ve paid the mortgage insurance.

However, with other lenders you can add the LMI onto the loan which means you get the full 90%. This is quite a big deal for most property buyers.

Firstly, if you wanted to buy a $500,000 property and applied through NAB then you’d need an extra $7,500 as a deposit!

Secondly, when you think about it, you’re actually paying more in mortgage insurance by not capitalising LMI.

NAB’s LMI looks cheap because their LMI premium rates are lower than most lenders. However, when you consider capitalisation, it’s often better to go elsewhere.

NAB’s LMI Premium table

LVR $0 – $300,000 $300,001 – $500,000 $500,001 – $750,000 $750,001 – $1,000,000
91% 2.00% 2.60% 3.48% 3.55%
92% 2.00% 2.60% 3.62% 3.69%
93% 2.25% 3.94% 3.76% 3.83%
94% 2.25% 3.94% 4.12% 4.20%
95% 2.48% 3.24% 4.36% 4.44%

Should you apply with NAB?

Not sure which home loan is right for you? Our Home Loan Experts can help!

Talk to one of our specialist mortgage brokers by calling us on 1300 889 743 or by completing our free assessment form.

  • MCline

    Hi there! We’re purchasing for $470,000 and we asked for security switch existing 5-year fixed (4 years remaining) rate loan of 6.49% with NAB. But the valuation of the purchase property was very low, at $420,000. It seems NAB don’t want the loan or continue with fixed rate of 6.49% for the additional 4 years. Can you help?

  • Hi MCline,

    Unfortunately, if the valuation is low then it’s usually best to get another valuation with another lender. Some potential options with NAB are:
    – Add a security guarantor
    – Reduce the loan based on the low valuation. You’d only pay break fees on the reduction in the loan amount (do check with NAB). You’d need a lot of cash to make this work though.

    We can get free upfront valuations with 11 lenders so let us know if you’d like a second opinion. Challenging a valuation has a 3% success rate so I wouldn’t bother with that! Feel free to call us on 1300 889 743 if you’d like our help.

  • Jonas Noe

    Hey, our current loan is with NAB and is secured with our property and two other people’s house. As the circumstances changed, they want to withdraw their house. Thus, we’re look to refinance the home loan. The problem is, NAB doesn’t accept our property alone as security. Their answer is that because our property is an inner city unit, they want to charge LMI even if I borrow 80% LVR, which we are not sure about…

  • Hey Jonas,

    Yeah, in some circumstances, NAB will require LMI for all properties over 70% LVR that are units in inner city areas. Other lenders can go up to 80% without LMI as they are more comfortable with these properties. Please call us on 1300 889 743 if you’d like help to get approved.