THE PROPERTY NERDS: 95% with no LMI?!

In this episode of The Property Nerds podcast, Arjun Paliwal from InvestorKit and Jack Fouracre from Fouracre Financial unpack the role of lenders mortgage insurance (LMI) in Australian property investment and how buyers can use it strategically.

While LMI protects lenders and is usually required for deposits under 20 per cent, Fouracre calls it a "love-hate relationship" as it lets investors enter the market sooner with less cash and more leverage.

According to the duo, paying LMI can allow investors to secure higher-value properties with smaller deposits, and savvy buyers can even access partial refunds if they refinance or sell within two years.

Additional benefits include potential tax deductions over five years, making LMI a tool for both leverage and long-term planning.

The duo then highlight the benefits of LMI waivers for certain professions, including doctors, nurses, midwives, physios, and some finance professionals, which can allow loans with as little as 5 per cent deposit and no LMI, reducing upfront costs and accelerating property acquisition.

The podcast emphasises that while LMI may feel like a financial burden, it can be a strategic advantage for investors willing to understand the nuances and plan carefully.