Читать книгу 30 Properties Before 30 - Eddie Dilleen - Страница 14

LMI is a security cost that is generally required if you are borrowing more than 80 per cent for a standard residential loan. It means if you don't have a 20 per cent deposit saved, you'll have to pay a fee to the bank because the loan is deemed to present a slightly higher risk to the bank.

In most cases, LMI can be ‘capitalised’ on the loan balance upon settlement, which means you don't have to come up with the money upfront — it is simply added to your home loan (and you therefore pay interest on this amount, as it forms part of the loan).