MAP has had a few clients lately who have applied directly to their lender or through another mortgage broker and been advised that the bank would happily lend to them however their lenders mortgage insurer would not due to their temporary residency or expat status.
The result of this is that the home loan application will be declined as the bank will not, without Lenders Mortgage Insurance, agree to approve the mortgage. This article outlines what lenders mortgage insurance is and how to avoid such a situation.
LMI is insurance that protects the bank when a borrower does not have a full 20% deposit. Essentially, it covers the bank should the borrower fail to pay the mortgage and the bank makes a loss on sale. LMI is, as a rule, only applied to home loans with an LVR of greater than 80%. It is insurance that protects the bank, not the borrower.
LMI is just like car or home insurance. Except in this case the asset being protected are the loan funds advanced to the borrower. So, just like you insure your car against fire or theft, the bank insures the loan just in case the borrower can not pay it back. The only difference is that the LMI premium is paid by the borrower even though the insurance protects the bank only. It would kind of be like you insuring your car and getting paid out if it was stolen, but the annual premium was paid by someone else.
Note: Unlike car or home insurance, LMI is a once off upfront fee.
If you have been declined because of your residency status there still may be hope. There two main lenders mortgage insurers in the market place as well as a handful of banks who self insure, that is, they insure the loans themselves. Therefore, your loan may have been declined by one of the lenders mortgage insurers but another one may well approve your loan.
It is therefore important that you get professional expert advice from a non-resident home loan specialist before applying again so as not to risk another credit enquiry on your credit file.
More information can be found here on what to do when your home loan has been declined by the banks or lenders mortgage insurers.
KarynMAP home loans were referred to me by my Financial Advisor. I was looking to purchase my forever home as I transition to retirement. It was a long shot that I would be able to purchase another home but with the help of Justin at MAP Home Loans this become a reality. I would recommend contacting Justin for your home loan needs.
Grant VolrathI was referred to MAP Home Loans through a 3rd party and can say that I was very well satisfied. Justin never missed any communication and seemed to go above and beyond to help us with our loan. Not only that but the care before and after along with guidance he got us a couple government grants too. Absolutely fantastic Job and will definitely be passing on his information to any friends and peers.
CatiaA huge thank you to Justin for his outstanding service! Finding the perfect place was no easy task and it took a while, but Justin’s support made all the difference. He was always available, providing expert advice and guidance every step of the way. He ensured that I was prepared for the application process, leading to a smooth and successful outcome. I couldn’t have asked for a better experience, and I wholeheartedly recommend Justin. Thanks for helping with this important milestone for me and my little family.
Almost there, please complete the form to request your..
In this Guide, you’ll discover…
Free Report LIVE 2020 WDS
Almost there, please complete the form to request your..
In this FREE phone consultation, you’ll discover…
And, much more – We will answer any of your questions!
In this Guide, you’ll discover…
We guarantee 100% privacy. Your information will not be shared.
In this Guide, you’ll discover…
We guarantee 100% privacy. Your information will not be shared.
Almost there, please complete the form to request your..
In this Guide, you’ll discover…
In this Guide, you’ll discover…
We guarantee 100% privacy. Your information will not be shared.
We allow you to…
We guarantee 100% privacy. Your information will not be shared.
We allow you to…
We guarantee 100% privacy. Your information will not be shared.
We allow you to…
We guarantee 100% privacy. Your information will not be shared.
We allow you to…
We guarantee 100% privacy. Your information will not be shared.
Almost there: please complete the form to request your…
We respect your privacy