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if its a private sale and favourable purchase - get the thing valued upfront rather than wasting your time with banks who are going to value once credit decision is done. Examples - nab, cba, anz. You might get an 80% lend off the bat and then no LMI. we did a 1700 default thru cba the other...

azaram am i reading this right that there was 3500 owing on this card for "X" years and nobody thought to pay it back... ?

are you purchasing it thru a real estate agent or a private sale - since you're the tenant. i.e. are you getting it below market value and option 2 may be to hit relatives up to use their equity in their house for the 5% you're short and pay that back over a rapid timeframe