Calculating LMI payable on top up loan

Discussion in 'Loans & Mortgage Brokers' started by Allison, 28th Jun, 2017.

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  1. Allison

    Allison Member

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    Hi there. I am trying to work optimize the LVR bracket/amount of top up loan I apply for with regard to the LMI I would pay. I am aware that some brackets are better/cheaper than others etc.

    I took a loan with St George early 2016 for $362,100. Purchase price was $426,000 so it was a 15% deposit.

    I paid LMI of $3,432.50

    Now I am trying to top up. I dunno how much exactly but the St George broker suggested $100k would only attract a premium of roughly $2k (he didn't sound sure though and it will take a few days to find out), does that sound correct? Also, any ideas on what the optimum amount to top up is in regards to keeping LMI down.

    I'll use the money to buy another property or two I suppose. Any other advice or tips?
     
    Allison, 28th Jun, 2017
    #1
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    LMI is a progressive scale - the higher the LVR the higher the percentage.

    your st g 'broker' (btw they are not a broker if working for st g) should be able to give you a PDF with the rates on it so you can work out what would be best. The lesser you take the smaller the amount will be.

    Keep in mind the deductibility issues.
     
    Terry_w, 28th Jun, 2017
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  3. Allison

    Allison Member

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    Thanks Terry

    How would the calculation look though considering I have already paid some LMI? Can you give an example of how I would arrive at the LMI payable on top up if you don't mind

    I mean would it be X% x 'new loan amount/top up amount only?' less $3,432.50?
     
    Allison, 28th Jun, 2017
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  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Generally
    LMI payable on total loan amount now less LMI that was paid previously.
     
    Terry_w, 28th Jun, 2017
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  5. Tom Simpson

    Tom Simpson Well-Known Member

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    It shouldn't take him a few days to get back to you.

    Like Terry said he should have access to a pdf or he'll have software into which he can enter two variables: home value and loan value.
     
    Tom Simpson, 28th Jun, 2017
    #5
  6. Dan Donoghue

    Dan Donoghue Well-Known Member

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    I built this a while ago, it should help you out.

    Update the green cells, You can update the brackets if you like to fit with the St George brackets.
     

    Attached Files:

    Dan Donoghue, 29th Jun, 2017
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  7. Allison

    Allison Member

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    I tried to download it but it says "you must be logged in to do that".
     
    Allison, 29th Jun, 2017
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  8. Dan Donoghue

    Dan Donoghue Well-Known Member

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    Dan Donoghue, 29th Jun, 2017
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