Did you know that if you repay your home loan within the first two years you may be eligible to receive a partial LMI refund?

Many lenders don’t notify their customers about this or they require you to complete a form in order to receive it.

Most borrowers miss out so don’t be one of them!

Are LMI refunds still available?

Most lenders have changed the agreements with their Lenders Mortgage Insurance providers so that customers pay a lower LMI premium.

However, those customers are no longer eligible for LMI refunds.

Please note that these changes were made around 2012.

If your loan was settled after 2012, it’s unlikely that an LMI refund is available.

Can my LMI policy be transferred?

At present, it’s not possible to transfer your LMI policy to another lender. You can get a discount on your new LMI premium if you stay with the same lender and increase your loan or internally refinance to a new loan.

There has been political pressure and suggestions within the mortgage industry that LMI portability should be allowed to make it easier for people with loans over 80% of the property value to change lenders without paying another LMI premium.

While this would be great for customers, it simply would not work for lenders with the way that they fund their loans and because they each have unique agreements with their mortgage insurers.

General requirements for an LMI refund

If you’re exiting your loan, use the below guidelines to find out if you may be eligible, then call your lender to confirm.

  • The loan must not have been in default, arrears or had any late repayments.
  • The loan must have been repaid less than two years from the date it settled.
  • The refund amount must be greater than $500.

LMI requirements

Please note the mentioned policies are for the two main LMI providers in Australia. However, each lender may have made a separate agreement with these providers. You should contact your lender to confirm their policy for your mortgage.

Genworth Financial

Genworth Financial no longer offers LMI refunds with any of their lenders. They will only offer a discount on their LMI premium if you’re increasing your loan or refinancing your loan and remaining with the same lender (this is known as an internal refinance).


  • The loan must not have been in default or arrears.
  • The refund amount must be more than $500.
  • The insured mortgage must be repaid in full (not a partial discharge).
  • A refund is due only if the loan is repaid in the first year after settlement.
  • The lender must notify QBE LMI that a refund is due within 30 days of the loan being discharged.
  • The amount of the partial refund will depend on the arrangements between QBE and the lender.

Westpac LMI (WLMI)*

  • Loan repaid in 12 months or less: You may be entitled to a refund of 40% of the LMI premium (minus stamp duty).
  • Loan repaid between 12-24 months: You may be entitled to a refund of 20% of the LMI premium (minus stamp duty).
  • A minimum refund amount applies so if the refund is less than the minimum, you’re not eligible for a refund.
  • LMI refund approvals are decided by WLMI, not the bank.

*Note: Westpac is the mortgage insurer for Westpac, St George and Rams but not all of their home loans will be insured by WLMI. Where there is a different LMI insurer for your mortgage, the above LMI refund policy may not apply.

ANZ LMI refund

  • Loan repaid in 12 months or less: You may be entitled to a refund of 50% of the LMI premium (minus stamp duty).
  • Loan repaid between 12-24 months: You may be entitled to a refund of 25% of the LMI premium (minus stamp duty).
  • The LMI refund only applies to loans settled on or after 1 October 2017.
  • The mortgage balance must be repaid in full – LMI refunds will not apply to loans that have been partially discharged, refinanced internally with ANZ, or consolidated with other loans.
  • The property security must not continue to secure any other loans in your name (as the borrower).
  • LMI refund approvals are decided by ANZLMI, not the bank.

Lender requirements

You should always contact your lender for information regarding the refund of an LMI premium.

  • Adelaide Bank: Uses QBE or Genworth policy, automatically applies for LMI refunds at the end of each month.
  • BankWest: Will refund 25% if the loan is repaid in the first 12 months.
  • CBA: No LMI refunds are available.
  • Liberty Financial: 30% of the LMI premium is refunded if you repay the loan in the first year and 15% if you repay the loan in the second year. You must request the refund. No refunds are available for low doc loans.
  • Homeside Lending: No LMI refunds are available.
  • NAB: No LMI refunds are available.
  • St George Bank: 40% of the LMI premium is refunded if you repay the loan in the first year and 20% if you repay the loan in the second year.
  • Westpac Bank: 40% of the LMI premium is refunded if you repay the loan in the first year and 20% if you repay the loan in the second year. You must request the refund.

Not all lenders publish their refund policy or procedure. We recommend that you assume your lender will require you to apply for a refund. It’s best to contact them and confirm their refund policy once your loan has been discharged.

How to request a refund

Call your lender’s customer service department and explain to them that you are requesting an LMI refund. They’ll then inform you of their procedure and may ask that you provide them with a written request.

Premium refunds can take upwards of three months as they are processed in batches. However, we recommend that you follow up regularly to make sure that your refund is processed. This type of request is not classified as urgent by most lenders, so it’s likely to be forgotten if you’re not diligent.

Save money on your LMI premium

For your next home loan, why don’t you shop around to find the lowest LMI premium as well as the lowest interest rate. Each lender has a different agreement with their mortgage insurer and so has different premium rates.

In some cases, lenders also offer discounts or special offers for a limited time. Please visit our mortgage insurance calculator page to compare premiums.

  • Mitchell

    I’m refinancing my mortgage, which has been less than 2 years. My friend has suggested me that I could get a LMI refund, does it applies in my case as well?

  • Hi Mitchell,

    It is unlikely that an LMI refund is available on your loan as lenders have changed their policies around 2012 so that the customers pay a lower LMI premium. However, you can speak to your bank and explain that you’re seeking a LMI refund, they should be able to assist you.

  • OwenH

    Didn’t know that we could get LMI refunded like this. Cool, need some help planning though so can you point me towards any resource that has the different rates applicable on different LVRs and loan amounts?

  • Hello OwenH,

    You can check out our LMI premium table that’s been offered by one of our lenders for both full doc (normal loans) and low doc loans to get an idea of the different LMI premium rates applicable on different LVRs and loan amounts. Here’s the link:

  • bridges

    Does NAB provide LMI refunds?

  • Unfortunately, no LMI refunds are available with NAB.

  • Brad I

    Hi, I went through a broker (RAMS) who used MSA National
    – does MSA National provide LMI refunds?

  • Hi Brad,
    MSA National is the solicitor that prepares the loan agreement between Rams and you as the borrower.
    You could have one of several LMI providers based on when you obtained the loan and how much you borrowed.
    It could be:
    – Genworth https://www.homeloanexperts.com.au/lenders-mortgage-insurance/compare-genworth-lmi/
    – Arch Capital https://www.homeloanexperts.com.au/lenders-mortgage-insurance/compare-arch-capital-lmi/
    – Westpac LMI https://www.homeloanexperts.com.au/lenders-mortgage-insurance/compare-westpac-lmi/
    You’d need to contact Rams to be sure. They may not know as it’s a rare request, but ask them to investigate and find out. They can contact their relationship manager at the LMI provider to find out.

  • Brad I


    I’ve called them and found out it’s with Genworth.


  • It would depend on the agreement between Rams and Genworth but normally Genworth do not give LMI refunds.
    By the way if you’d like help with a loan in the future feel free to call us. Unbiased opinion but we’re totally amazing ;)

  • Ruchika Mehta Sawhney

    Hi,my loan has been refinanced with RAMS and my earlier bank was westpac .can I apply for LMI refund from Westpac. My loan was refinanced less than a year.

  • Hi Ruchika,
    Westpac would refund 40% in year one and 20% in year two. This information is correct as of 2011 so it may have changed since then. You’d need to contact Westpac to apply for the refund.

  • Ruchika Mehta Sawhney

    Thanks for that,is there any limitation period to apply for a refund after the refinance .

  • Sorry I am not sure. You’d need to contact Westpac. With other lenders it tends to be a one year maximum.

  • Linda Kiernan

    Hi. Do you know if any of the Insurers that don’t offer any refund have ever been challenged? I’m with ANZ – who self insure! And no refund. I am thinking of taking the matter further, particularly because they self insure. I paid a lot of LMI – over $30,000! Thank you

  • Hi Linda,
    I’m not aware of any case studies where someone has challenged the banks on this. Based on my understanding there would be no legal grounds to request a refund, however I’d recommend that you obtain legal advice on this if you want to challenge them.

  • Damian Gray

    Could you please clarify if the underwriter (Genworth in this case) still charges the lender (Commonwealth in this case) the full insurance premium on a lenders mortgage insurance policy if the property covered is sold before the original term (30 years in this case & property covered was sold in less than 18 months into the 30 year agreement) or it is charged on a pro rata basis?

    Ie Original premium to cover the mortgage was $10,549 over a 30 year mortgage but property was sold in less than 18 months and cover is no longer needed, does the bank still have to pay the full 30 year cover premium or is it refunded to them on a pro rata basis? Or secondly does the bank pay a weekly/monthly/yearly premium to the underwriter and hold the original funds paid by the borrower to pay this premium in installments over the 30 years?

    If this is the case, what happens to the excess funds left over? Does Commonwealth keep it? Or does the underwriter take the full $10,549 regardless of insuring the mortgage for 18 months or 30 years?

    In any other insurance premium set up (car/health/home & contents etc), the insured could pay up front or pay monthly/weekly etc and then if/when insurance was cancelled the premium paid could be refunded on a pro rata basis if the full term of the paid policy was not reached, is this not the case with LMI?

  • Hi Damian,
    Sorry for the late reply.
    Usually, it’s charged by the insurance provider at one go and it may depend on the agreement between the lender and the insurance provider, which we aren’t aware of.
    Regarding the excess funds left over in case of the property being sold after 18 months, both Genworth and CBA won’t allow for any LMI refund. Unlike car/health and other insurance setups, LMI refund is usually not applicable on home loans.