We have an IP which we have sold and settlement is next week. We have had it just under 2 years and paid LMI when we purchased it. Wondering if a portion of the LMI would be refunded since we only had it a short time?
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Haha Peter can I set you a challenge to answer all questions like that for 1 week.
LMI companies love it when you pay insurance for 30 years but only need if for 1. They have removed the risk but still keep the profit.
Its more likely your lender will also impose a fee for paying out the loan early. I had a client (Wpac) who hit him with a $750 deferred application fee because he sold the IP within the first 5 years. I cant say I have ever seen a borrower pay $750 so that is a rort. In the loan contract but a rort.
Was the loan pre 2009? These type of arrangements used to exist in the past, restricting mobility between lenders.
I thought the Rudd government got rid of exit fees for loans? Part of creating more competition in our mortgage market.
Its not an exit fee. Its the application fee that was deferred. ie a penalty for making the bank not make as much money as they planned. Now its triggered. All as a result of the Rudd changes. Sure they ended exit fees and those ones that were sometimes a %. But they didn't prevent costs being deferred or based on exit costs.