Lenders assess mortgage applications differently based on the location of the property being offered as security. A lender, or the Lenders Mortgage Insurance provider, will apply more rigid lending policies in high-risk locations to limit their risk. This risk assessment often means that your maximum permissible LVR (and your borrowing amount) to be lower.
The Lender’s LMI Policy Guide may be consulted for information on what postcodes or property types might be affected, or you may use the tool below to check your postcode against the database. Keep in mind that not all localities within each postcode is affected, and nor is each property type.
The most common limitation that applies in areas where a postcode is considered risky is the maximum LVR may be reduced to 80%. You can read more about LMI in our LMI FAQ.
If you would like to have a discussion, please call us anytime on 08 8914 0068.
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Related FAQs:
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Inflation is an increase in the level of prices of the goods and services that households buy. It is measured as the rate of change of those prices. Typically, prices rise over time, but prices can also fall (a situation called deflation).
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How is Compound Interest Calculated?
Compound Interest is the addition of interest to the principal sum of a loan – basically meaning that you pay interest on interest. Compound interest is standard practice when taking out a home loan.
