I've just read the Money magazine story (Money Best of the Best 2014) where it is suggested that "Another way to reduce your premium is to split your loans. For instance, LMI premiums on loans over $300,000 cost significantly more than those charged on loans les than $300,000."
"Finder.com.au says if you were looking to buy two investment properties for each of which you need a $300,000 loan at an LVR of 95%, common sense would say to take out a loan for $600,000. However, the premiums calculated on two $300,000 loans may be less than the LMI premium on a $600,000 loan."
"According to the Genworth estimator, on a $600,000 loan for up to 30 years, with an LVR of 95%, the saving could be as much as $12,584, which more than makes up for the doubling-up of application fees from two loans."
I'm wondering if the same theory could be used for someone borrowing $600,000 for ONE house. Could they use two loans somehow to reduce LMI?
"Finder.com.au says if you were looking to buy two investment properties for each of which you need a $300,000 loan at an LVR of 95%, common sense would say to take out a loan for $600,000. However, the premiums calculated on two $300,000 loans may be less than the LMI premium on a $600,000 loan."
"According to the Genworth estimator, on a $600,000 loan for up to 30 years, with an LVR of 95%, the saving could be as much as $12,584, which more than makes up for the doubling-up of application fees from two loans."
I'm wondering if the same theory could be used for someone borrowing $600,000 for ONE house. Could they use two loans somehow to reduce LMI?