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What is Lender's Mortgage Insurance or 'LMI?'

What is Lender's Mortgage Insurance or 'LMI?'

LMI is designed to protect the lender should you not continue to meet your repayments. It protects the lender against a short-fall in the event your security property needs to be sold to clear the loan balance. LMI is only typically required where your deposit is less than 20% of the purchase price (Varies with some property types such as Rural) and is paid for by the borrower as a one-off premium payment to an insurer normally from loan proceeds.