Mortgage Glossary

What is LMI (Lenders Mortgage Insurance)?

Insurance that protects the lender (not you) if you default and your property doesn't cover the loan.

Lenders typically require LMI when your deposit is less than 20% of the property value (an LVR above 80%). It's a one-off premium, usually added to your loan amount, and the cost depends on your LVR and loan size. LMI doesn't protect you as the borrower — it protects the lender's exposure on high-LVR loans.