LMI calculator, and the four ways to not pay it.

It depends on your LVR, not the loan size alone - LMI prices off how much of the property you are borrowing. On a $500,000 loan: at 85% LVR expect roughly $3,500 to $5,500; at 90% roughly $7,500 to $10,500; and at 95% roughly $14,000 to $20,000. At 80% or below there is no LMI at all. That jump between 90% and 95% is the reason finding another 5% deposit is often the highest-return thing a buyer can do.

No. A 25% deposit puts you at 75% LVR, comfortably under the 80% threshold where LMI starts, so there is nothing to pay. You are also in the band where lenders compete hardest on rate, because a 75% LVR loan is the lowest-risk file they see. If you are choosing between a bigger deposit and keeping cash in an offset, that is worth modelling rather than assuming - the cash may work harder beside the loan than inside it.

Very. At 40% LVR you own 60% of the property outright, there is no LMI, and you sit in the sharpest pricing tier every lender offers. It also gives you room to release equity for a renovation or a deposit on the next property without going anywhere near an LMI threshold. The question at that point is usually not whether you can borrow, but whether your money is doing the most useful thing where it currently sits.

Sometimes, and it is worth checking rather than assuming. LMI waivers are profession-based, and while they are best known for doctors, several lenders extend them to other health professionals - nurses and midwives appear on some lenders' eligible lists. But the lists differ by lender, so do the LVR caps, and they are revised regularly. There is no single industry rule to rely on. Which lenders currently include your registration, and which of those prices best for your loan, is a short broker question with a specific answer.

LMI is a one-off insurance premium charged when you borrow more than 80% of a property's value. It protects the lender if you default, not you, and it's usually added to your loan, so you pay interest on it for the life of the loan.

A $540,000 loan at 90% LVR typically attracts an LMI premium somewhere around $8,000-$12,000 depending on insurer and lender. The calculator above brackets your exact numbers, and the avoid-LMI paths below it are often worth more than shopping the premium.

Usually yes. Most lenders capitalise the premium into the loan so you don't pay cash upfront. It's convenient but means paying interest on the premium for up to 30 years; the true cost is meaningfully higher than the sticker price.

Four real paths: get to a 20% deposit (or 80% LVR); use the First Home Guarantee if you're an eligible first home buyer (5% deposit, no LMI); use a family guarantor to bring effective LVR to 80%; or qualify for a professional LMI waiver: some lenders waive it to 90% LVR for doctors, lawyers, accountants and other professions.

Sometimes, honestly, yes. If prices in your target area are rising faster than you can save the next 10% of deposit, paying LMI to buy years earlier can be the cheaper mistake. It's a numbers comparison, one a broker can run with you in minutes.

Only in a narrow window, and only sometimes. Helia, the largest LMI provider in Australia, publishes a partial refund of up to 40% of the premium where the loan is discharged within 12 months and up to 20% between 12 and 24 months, with nothing after that and nothing where the loan fell into arrears. Some policies trade the refund right away for a larger upfront discount, so it is not universal. Check the certificate of insurance for your loan and ask your lender, because the refund is claimed through them, not from the insurer directly.

No. The policy belongs to the lender, not to you, so refinancing above 80% LVR means a fresh premium at the new lender rather than a transfer of the old one. That is the single strongest argument for getting the lender choice right the first time when you are buying with a small deposit, and for waiting until your LVR is under 80% before refinancing if you can.

Usually, yes, on both counts that matter. Insurers price investment lending above owner-occupied at the same LVR and loan size, though the loading is not uniform - some insurers and some lender books price the two identically and others charge appreciably more. The bigger difference is the ceiling: owner-occupied lending with LMI reaches 95% LVR at most lenders, while investment lending generally stops at 90%. Above that the appetite is thin and where it exists it is a policy exception rather than something to plan a purchase around. If you are an investor with less than a 10% deposit, the conversation is about structure - equity in another property, or a bigger deposit - not about shopping the premium.

Indirectly, and it is the most common way people get this wrong. Duty, legals and inspections are paid out of the same savings as your deposit, not on top of them, so the deposit that reaches the lender is whatever is left once they are covered. A buyer with $150,000 saved against a $750,000 purchase looks like a 20% deposit and no LMI, but once costs come out of it they are closer to 85% LVR with a premium to pay. Put your costs into the calculator above and it shows you both figures. Your solicitor or conveyancer is the one to confirm the transfer duty itself - we refer that out rather than estimating it.

Not for an owner-occupied home. For an investment property it is treated by the ATO as a borrowing expense, which means it is claimed over five years or the term of the loan, whichever is shorter, rather than all in the first year. If total borrowing expenses are $100 or less they can be claimed in full immediately, and if the loan is repaid early the remaining balance can be claimed in that year. Confirm the treatment with your accountant, and see ato.gov.au for the current rule.

No, and this is the most common misunderstanding on the subject. LMI covers the lender's loss if the property is sold for less than the outstanding debt. If that happens, the insurer pays the lender and can then pursue you for the shortfall it paid out. The cover you buy for yourself is a different product entirely: income protection, life or mortgage protection insurance.