Mortgage Insurance

Mortgage insurance is an insurance cover arranged by the lending institution to protect the money it lent to you in the event you are unable to repay the loan

Generally when the loan is over 80% LVR the lender requires mortgage insurance. The costs are paid by the borrower as part of the associated costs of establishing the loan.

The premium for this type of insurance is a once only charge and calculated as a percentage of the amount borrowers plus stamp duty.

Whilst mortgage insurance protects the lender in the event you default on your loan, there are many benefits to the home borrower. It allows them to borrow sooner and with a smaller deposit. In times of rising property prices mortgage insurance allows borrowers with small deposits gain a foothold in the market and thereby increase their equity through capital growth.