Charging LMI Twice

[Chomp]

Ok so I borrowed 90% to do a battleaxe subdivision, with a LOC to use for the refurb and sub division, I paid (borrowed) around 15k in LMI.

I sold the rear block and brought the mortgage down on the front house using all of the proceeds from the sale.

Now I have applied for a new LOC 90% but ANZ are saying its a new loan / money and want to charge me 2k on top for LMI again.

I think its a bit harsh as the original loan only lasted 10 months before I brought it right down, is there such a thing as refund for the original LMI I paid ?

Chomp

 

[Colin Rice]

If the old LOC loan account was paid out and closed then a new account number would be created for the second increase and is considered a new loan application and will be set up/opened and they will sting you again.

If you increased an existing loan you would be entitled to the LMI credit.

 

[Chomp]

Hi FMS, they just reduced the mortgage, the LOC only had about 2k remaining in it and was left untouched.

 

[Colin Rice]

If your new increase is more than the original then you will have to pay the difference. The mortgage insurers jacked the rates up recently so that may be a factor as well.

 

[HD_ACE]

Sounds like the extra 2k is just the difference between the old premium and new premium. So if its higher amount of borrowing than the first time orin rfasein premium then you will pay more. Otherwise you would be paying another15k.

Cheers

 

[Chomp]

Ace, 2k is what I had left over in the LOC

I originally borrowed 770k all up

After selling the rear block, reducing the mortgage, and getting the place revalued I can access another 110k add that on to the existing mortgage only comes to 520k.

So I am actually borrowing a lot less, but they still want more LMI that is why I'm not happy.

 

[HD_ACE]

Ok so I borrowed 90% to do a battleaxe subdivision, with a LOC to use for the refurb and sub division, I paid (borrowed) around 15k in LMI.

I sold the rear block and brought the mortgage down on the front house using all of the proceeds from the sale.

Now I have applied for a new LOC 90% but ANZ are saying its a new loan / money and want to charge me 2k on top for LMI again.

I think its a bit harsh as the original loan only lasted 10 months before I brought it right down, is there such a thing as refund for the original LMI I paid ?

Chomp

So how much are they charging for lmi?

 

[Chomp]

Around $1900 I think, its not that much but the 15k I paid originally for 10 months is !

 

[Terry_w]

Sounds like the extra LMI is being charged because you are borrowing more money this time. $2k in LMI is a small amount so you have probably got a credit for what you paid before.

 

[Chomp]

Not much in the scheme of things, but rather it in my pocket than theirs

 

[Peter_Tersteeg]

If it were a new policy, they'd likely be charging you about $17k. The bank has done the right thing by you.

The LMI is another matter. They've been putting up their premiums ruthlessly for a while now, with no justification for it.

 

[Aaron_C]

Sounds like the bank has credited you the LMI you already paid. Don't forget that even if you have paid say 15k LMI and the new LMI charge is less than that (through a LVR reduction usually), the minimum LMI charge is still $600.

 

[Chomp]

Thing is I could have reduced the mortgage by the minimum amount after I sold the rear block, so I wouldn't have had to re apply for an extended LOC.

 

[Rolf Latham]

The LMI is another matter. They've been putting up their premiums ruthlessly for a while now, with no justification for it.

Da ponzi conspiracy : )

ta
rolf