Hi all. My question is simply: Can a lender charge you LMI on the same property twice even though a new valuation is higher and therefore your LVR reduced?
We got a mortgage with RAMS for a 90% lend on our land and construction valued at $495k on completion. We also put in an extra $27k of our own funds to upgrade over the fixed price contract. Five months later we got an independent property val by the same val company that RAMS solely use. It came back at $585k, we desperately needed a newer car so got approved for a new mortgage (we are fixed on our original lend, so couldn't refi) of $40k and bought the car.
So our original LVR was 90%, we are now at about 81% (new higher val + additional fixed rate loan of $40K. Included in the fees & charges on our new loan was an LMI charge for the 1% ish over 80%. I argued this charge with RAMS who just blamed Genworth. We originally paid over $6k LMI on our home, now they are holding an asset which is worth $90k more than the original val on the first lend and charge us LMI again? I just can't get my head around it as I hear so often that 'you won't pay LMI again if you stay with the same lender' on here which appears to be utter crap!
Are they charging this because we weren't on a variable rate and therefore able to increase our loan? Or would it have not made a difference? We are looking to buy an IP soon and if they are just going to charge more LMI the option of going to another bank for the IP loan is looking very good.
Can anyone more clued up than me help me on this one?
Thanks in advance
We got a mortgage with RAMS for a 90% lend on our land and construction valued at $495k on completion. We also put in an extra $27k of our own funds to upgrade over the fixed price contract. Five months later we got an independent property val by the same val company that RAMS solely use. It came back at $585k, we desperately needed a newer car so got approved for a new mortgage (we are fixed on our original lend, so couldn't refi) of $40k and bought the car.
So our original LVR was 90%, we are now at about 81% (new higher val + additional fixed rate loan of $40K. Included in the fees & charges on our new loan was an LMI charge for the 1% ish over 80%. I argued this charge with RAMS who just blamed Genworth. We originally paid over $6k LMI on our home, now they are holding an asset which is worth $90k more than the original val on the first lend and charge us LMI again? I just can't get my head around it as I hear so often that 'you won't pay LMI again if you stay with the same lender' on here which appears to be utter crap!
Are they charging this because we weren't on a variable rate and therefore able to increase our loan? Or would it have not made a difference? We are looking to buy an IP soon and if they are just going to charge more LMI the option of going to another bank for the IP loan is looking very good.
Can anyone more clued up than me help me on this one?
Thanks in advance
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