Important: There are no longer any lenders in Australia offering No Deposit Loans. You can still borrow 100% with a Guarantor Loan.

Which lender has the cheapest LMI?

Every lender has different LMI premiums so it’s critical to shop around for your no deposit loan.

The problem is that lenders don’t publish their LMI rates on their websites.

The only ways to find out their LMI premiums are to call every bank or use a mortgage broker.

Essential guides and tools

What is LMI?

Lenders mortgage insurance (LMI) is a type of insurance that protects the lender from losses in the event that you were to default on your loan. Genworth, PMI, WLMI, SGI and ANZ LMI are some of the common LMI providers in Australia. Note that the lender will obtain the insurance behind the scenes, however you will have the pay for the premium!

Although you receive no direct benefit from obtaining lenders mortgage insurance, the bank would not approve your loan without it. So in effect, LMI allows banks to approve loans that would otherwise be too risky and so in turn allow you to borrow more than 80% of the purchase price. LMI is a one-time fee and it is charged when your loan is advanced.

Which lenders use LMI and risk fees?

Some lenders prefer to use a third party insurer such as PMI or Genworth to insure their loans. Other lenders have their own in house insurance companies and so, are insuring themselves.

A few select lenders simply charge you a “risk fee” and approve your loan without LMI, but in effect have achieved the same goal under a different name. One prominent example of this is St. George with their “LEF” risk fee as well as their own insurer St. George Insurance (SGI).

  • Who uses LMI? : ANZ, CBA, NAB, Westpac, ING, Suncorp, St. George, Widebay Capricorn, AMP, Citibank and many more.
  • Who has their own insurer?: ANZ, Westpac, St. George and Widebay Capricorn.
  • Who can charge a risk fee?: St. George (LEF), ING and most non-conforming lenders.

For the purpose of this guide, we will call all of the above types of insurance “LMI”, even if it is in fact a risk fee. If you would like a quote for a risk fee or LEF loan then please call us on 1300 889 743 or enquire online.

What determines the LMI premium?

The LMI premium is calculated based on the loan amount, Loan to Value Ratio (LVR), LMI product type (e.g. First home buyer, non genuine savings, low doc, 100% loan etc) and the lender. Did you know that even though Genworth and PMI deal with most lenders, they have different pricing for different lenders?

Hint: If you borrow less than $300,000 your LMI will be incredibly cheap. If you borrow just over $300,000 then your LMI may increase by several thousand dollars. The same leap occurs when you borrow more than $500,000. This is because lenders have different premium rates depending on if your loan is less than $300,000, less than $500,000 or more than $500,000.

How large can LMI premiums be?

The LMI table below is an example only and does not include your state governments stamp duty, if applicable (usually 10% of the premium).

First Home Buyer – 100% Loan LMI

  • Less than $300,000: 2.02% to 2.85% of the loan amount.
  • $300,000 to $500,000: 2.61% to 3.71% of the loan amount.
  • Greater than $500,000: 3.33% to 3.42% of the loan amount

2nd Home Buyer – 100% Loan LMI

  • Less than $300,000: 2.02% to 2.85% of the loan amount.
  • $300,000 to $500,000: 2.61% to 3.71% of the loan amount.
  • Greater than $500,000: 3.33% to 3.42% of the loan amount.

Investor / Investment – 100% Loan LMI

  • Less than $300,000: 2.50% to 2.56% of the loan amount.
  • $300,000 to $500,000: 2.99% to 3.34% of the loan amount.
  • Greater than $500,000: 3.55% of the loan amount.

Quick start no LMI loans – 100% Loan without LMI

  • Less than $300,000: No LMI is payable.
  • $300,000 to $500,000: No LMI is payable.
  • Greater than $500,000: No LMI is payable.

Notes: LMI premiums are subject to change, please send us a free online enquiry for an up to date quote for your situation. The above premiums do not include state stamp duty. Quick start loans do not have any LMI payable however have a higher interest rate to compensate and so are appropriate for anyone who has very little money to contribute but has a high income. A range of different lenders risk fees, LEF fees and LMI premiums were compared to create this LMI table for you. No deposit construction loans have the same LMI premiums as normal loans.

Important: You may have noticed a significant difference between the different premiums charged by different lenders! For example, the difference between the best and worst is $4,400 for a $400,000 No Deposit loan! Please shop around to make sure that your loan is competitive.

Calculate your LMI premium with our LMI calculator

Several lenders have issued calculators that allow their bank managers and mortgage brokers to accurately calculate an LMI premium for you. These are not available to the general public as they are quite complex. We have developed a simplified online LMI calculator for use by the general public.

How to get the cheapest LMI?

We have the LMI premium rates and tables for most major lenders in Australia.

If you aren’t sure which lender offers the cheapest LMI for no deposit home loans then please enquire online or call us at 1300 889 743 for a free quote.

  • Christopher

    Will the bank capitalise and add the LMI amount in the loan amount or add the LMI in the loan amount? For eg, if the loan amount is 100k and the LMI 10k, then will the bank give us 90k or will they give us 100k making the loan amount 110k?

  • Hi Christopher,

    The LMI can be added on top of your loan amount or can be paid for separately as well as per your requirement. If you want more cash now, then we could capitalise the LMI amount on top of the loan and increase the loan amount to 110,000 in the above example.

  • Sou

    Hi, can you tell me of a couple ways that I can get my LMI to be as low as possible?

  • Hey Sou,

    We have a page on 3 ways that you can slash you LMI premium so even if you’re not in a position to qualify for a no LMI home loan, you can go for a cheaper LMI. Please have a look here:

  • Mercury

    I’m not sure if I’m going guarantor so can you explain how a HECS debt can affect my borrowing power ? Not sure if it makes a big impact.

  • Hi Mercury,
    A HECS-HELP debt does indeed affect your borrowing power and so it’s treated the same way as any other liability by the banks. Please check out this page to find out about this in detail:

  • MA

    Hello, can you please explain to me what a split mortgage is?

  • Hi MA,

    A split mortgage, or a split rate home loan, is a loan feature that allows you to split your home loan into multiple loan accounts that attract different interest rates. A popular example for this is to split the home loan to attract a variable interest rate and another to a fixed rate. Before you go for this, it’s recommended that you seek professional advice from your accountant or a professional financial advisor about your current situation to figure out what suits your need.

  • Rhea

    I’m a pro athlete and my earning are solid right now and have been great for the past couple of years. Can I be considered for a complete LMI waiver?

  • Hi Rhea,
    Different professional athletes can be considered under the condition that they have an accredited manager, agent or account. Please have a read of the professional athlete home loans page to learn about this in detail:

  • Peterson22

    I’m planning to buy an investment property and want to borrow 90% of the purchase price. I just wanted to know the applicable LMI on that loan?

  • Hi Peterson22,
    LMI varies with the lenders as they have different insurers. You could try our LMI calculator and find the cheapest LMI premium from our panel of lenders. Call us on 1300 889 743 and speak with one of our mortgage brokers to find out if you qualify.