LMI Calculator
Estimate what Lenders Mortgage Insurance might cost if your deposit is under 20%, and see how much bigger your deposit would need to be to avoid it.
Your details
Estimated LMI premium
$9,450
Loan amount
$630,000
Loan-to-value ratio (LVR)
90.0%
20% deposit needed to avoid LMI
$140,000
LMI is priced by private insurers based on their own rate cards, which vary by lender, loan size and borrower profile, there's no single public formula. This estimate is based on typical published premium patterns and is indicative only, not a quote. Some state stamp duty may also apply on top of the premium in most states. Get an exact figure from your lender before relying on this.
How to use this calculator
- 1. Enter the price of the property you're looking to buy, or its current value.
- 2. Enter how much you're putting down as a deposit.
- 3. The calculator works out your loan-to-value ratio (LVR) and estimates the LMI premium based on typical published rate patterns.
What LMI actually is
Lenders Mortgage Insurance protects the bank, not you, if you default on your loan and the sale of the property doesn't cover what's owed. Lenders generally require it whenever your loan-to-value ratio (LVR), your loan amount as a percentage of the property's value, is above 80%, which is another way of saying your deposit is below 20%. It's a one-off premium, usually added to your loan amount rather than paid upfront in cash, which means you also pay interest on it over the life of the loan.
Why the premium jumps so much at certain deposits
LMI premiums aren't a flat percentage, they rise steeply as your LVR climbs, with noticeable jumps at 85%, 90% and 95% LVR. That's because a smaller deposit means more risk for the insurer if the market falls. In practice this means saving even a few extra percentage points of deposit, say getting from a 12% deposit to a 15% deposit, can meaningfully cut what you pay, even though you're still below the 20% threshold and still paying some LMI either way. Some lenders also waive LMI entirely for certain professions (like doctors, some accountants and lawyers) even with a small deposit, worth asking about if you're in one of these fields.
FAQ
Is LMI a one-off cost or an ongoing fee?
It's a one-off premium charged when your loan settles. Most people add it to their loan amount rather than paying it in cash, which means it's repaid (with interest) over the life of the loan rather than being an ongoing separate fee.
Can I avoid LMI without a 20% deposit?
Sometimes. A family guarantee (where a parent uses equity in their own home as extra security) can avoid LMI entirely. Some professions get waivers from certain lenders. The First Home Guarantee scheme lets eligible first home buyers borrow with as little as 5% deposit without paying LMI, though places are limited and conditions apply.
Is LMI refundable if I sell or refinance early?
Sometimes partially, within the first 1-2 years, some insurers offer a pro-rata refund if you refinance or pay off the loan early. It varies by insurer and lender, check your specific policy.
Does a higher loan amount always mean higher LMI, even at the same LVR?
Yes, LMI is typically charged as a percentage of your loan amount, and that percentage itself also tends to rise for larger loans within the same LVR band, so a bigger loan at the same LVR usually means a higher premium, not just a proportionally scaled one.
Who actually sets LMI premiums?
LMI is provided by specialist insurers, mainly Helia (formerly Genworth) and QBE in Australia, not by your bank directly. Your lender chooses which insurer to use and may apply their own margin, which is part of why exact premiums vary between lenders for the same LVR and loan size.
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Disclaimer
LMI is priced by private insurers based on their own rate cards, which vary by lender, loan size, borrower profile and insurer. There is no single public formula. This calculator uses a simplified estimate based on typical published premium patterns and is indicative only, not a quote. Some state stamp duty may also apply on top of the premium. This tool provides estimates only, is not financial advice, and doesn't replace an exact quote from your lender.