The Mortgage Agency

LMI Waiver for Financial Professionals

If you’ve reached the point when you’re ready to buy a home or investment property, being a financial professional could afford you significant benefits—such as not having to pay lender’s mortgage insurance (LMI). 

Most lenders require one or the other: more than 20% deposit or lender’s mortgage insurance. As a financial professional, you can avoid both of these things, meaning you effectively save money and you have the opportunity to buy property sooner than you may have thought.

Partner with The Mortgage Agency to take advantage of the LMI waiver for financial professio

Why Do Lenders Require Borrowers to Pay Lenders Mortgage Insurance (LMI)?

In Australia, home loan lenders require borrowers to pay Lender’s Mortgage Insurance (LMI) premiums primarily as a protection measure. LMI is designed to safeguard the lender against the potential loss they would incur if the borrower fails to repay the loan.

For example, in everyday situations, when a borrower defaults on their mortgage repayments, home loan providers repossess the property and use the money to cover its losses. 

Problems arise if the property value decreases. In that case, selling the property will not make enough money to recover the lender’s losses. 

This is why lenders require either a 20% or more deposit (to cover the balance of the loss after depreciation) or lenders mortgage insurance.

If a borrower has less than 20% deposit, also known as a high loan-to-value ratio, they must pay LMI fees, which can be around 2% of the home loan value. So, if your home loan is $900,000, your LMI can amount to $18,000.

Is There a Way to Have LMI Waived?

If you’re an accountant, actuary, financial analyst (CFA), or CFO, The Mortgage Agency can help you save tens of thousands of dollars on your low-deposit home loan simply by taking advantage of your profession.

Which Financial Professionals Are Eligible to Waive LMI?

The most common way for potential home buyers to achieve an LMI waiver is to deposit more than 20%, but saving up for this could take considerable time, or if you’re eligible for Government Schemes

To improve Australian citizens’ ability to get on the property ladder, there are some avenues beyond the home loan deposit scheme that can help you avoid LMI costs.

For example, certain professionals are eligible for LMI waivers because they earn high-income salaries that are stable and consistent. 

In addition to medical professionals, such as members of the Australian Medical Association, many professionals in the financial field may also be eligible for a waived LMI, including:

  • ​​Accountants
  • Actuaries
  • Auditors
  • Chief Financial Officers 
  • Finance Directors
  • Finance Managers
  • Financial Controllers 
  • Financial Planners

Here’s an Example:

Helen is the CFO of a large company and has easily saved up to $50,000 for a deposit over the last few months. However, the property she’s interested in buying costs $500,000, so Helen will need to borrow $450,000.

She calculates her LVR by dividing what she needs to borrow by the property price.

450,000 ÷ 500,000 = 90%

Helen has only been saving for a few months and has a high LVR of 90%. Usually, this would require her to pay the lender’s mortgage insurance. Fortunately, since Helen is an eligible financial professional, she may be able to waive the LMI even though her LVR is more than 80%.

Our home loan experts can help you achieve an LMI waiver and avoid this significant addition to your home loan. Contact our team to get started today.

What Do You Need To Qualify For an LMI Waiver For Accountants and Other Financial Professionals?

Registered Memberships

Financial professionals must be registered with one of the following memberships to be eligible for an LMI waiver:

Evidence of membership can be submitted in the form of:

  • Current valid membership card
  • Practising Certificate
  • Receipt for payment of annual membership
  • Written confirmation from the association

Other industry bodies, as well as overseas qualifications, are considered on a case-by-case basis.

Income

Certain banks require a certain income level before this policy and benefit can be applied, however for some lenders there is no income threshold required. . It’s best to speak to us first so we can provide you with options.

What Other Benefits Come with Home Loans For Accountants, Auditors, & Other Financial Specialists?

Due to your favourable financial position, a mortgage broker can negotiate lower interest rates and discounts on your home loan. As you’re an attractive borrower, lenders may be more likely to comply just to sign you up as a client.

Regarding refinancing, you can also refinance up to a maximum of 90% of the property value without paying LMI. This means you have more access to your home’s equity; you can use that money to buy more investment properties.

Lenders will also approve home loans for lawyers with a high loan-to-value ratio, meaning they can pay a smaller deposit without having a guarantor or paying LMI. This means those in the financial profession can become homeowners sooner because they don’t have time to save a sizable deposit.

Why Do Financial Professionals Get These Benefits?

High-income professionals, such as accountants, are attractive clients for lenders because they are less likely to default on their home loans.

These professions suffer from little employment volatility, so they’ll unlikely lose their job unexpectedly and cannot honour their mortgage repayments, even with maximum loan size.

Additionally, having to study for many years means they’re less likely to spontaneously make a career change and earn less money than before, meaning they would no longer be able to afford their mortgage.

As a result, lenders offer perks such as LMI waivers for qualified accountants to incentivise them and secure their business. 

Thanks to your high income and stable job, lenders may even agree to a lower interest rate on home loans for accountants.

Contact us today to take advantage of these home loan benefits.

How The Mortgage Agency Can Help

Our brokers specialise in acquiring home loans for accountants and other financial professionals. Over the years, we have assisted many in taking out the maximum loan amount with a minimal deposit, no LMI, and lower interest rates.

We’ll handle all the nitty-gritty on your behalf. We can meet you wherever you’re at, assess your current financial situation, and advise on the best strategies to implement to reach your financial goals.

We’re committed to helping you achieve homeownership and saving you money—whether it’s your first home or investment property. We can also review your existing home loan and help you refinance to a more viable option.

Frequently Asked Questions

What is Lender’s Mortgage Insurance (LMI) for financial professionals?

Lender’s Mortgage Insurance (LMI) protects lenders against potential losses if a borrower defaults. In Australia, it is typically required when a borrower has a deposit of less than 20% of the property’s value, representing a higher risk for the lender. Paying LMI allows borrowers to purchase a home with a smaller deposit.

How can financial professionals benefit from an LMI waiver?

Financial professionals, including accountants, auditors, and CFOs, can qualify for an LMI waiver through The Mortgage Agency, given their higher earning capacity, job stability, and more. This waiver can save tens of thousands of dollars by eliminating the need to pay LMI even with a low deposit, facilitating the purchase of a home or investment property sooner.

Who is eligible for an LMI waiver, and what are the qualifications?

Eligibility for an LMI waiver is generally extended to high-earning financial professionals with stable and consistent incomes. Required qualifications often include membership in recognised professional bodies like Certified Public Accountants Australia or the Chartered Financial Analyst Institute Australia. Some lenders might also need a minimum annual income to approve the waiver.