01 Borrowing & leverage Reviewed 30 August 2026
Lender’s mortgage insurance
LMI
Insurance that protects the lender if a borrower cannot repay a home loan.
What LMI means
LMI protects the lender, not the borrower. It is commonly charged as a one-off cost when the loan is large relative to the lender’s property value.
Why it matters
LMI can materially increase the upfront or financed cost of a purchase. Adding it to the loan also means paying interest on that amount.
Take the next step
Ask Heyward A definition cannot see your position. Heyward can.
Start with: “Would LMI apply to the purchase I am considering, and what would it change?”
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Sources
Primary & official where available- ASIC Moneysmart Lenders mortgage insurance (LMI)
- ASIC Moneysmart Buying a house
General educational information only. It does not account for your objectives, financial situation, legal position or tax circumstances.