Browse Forums Building A New House Re: LMI for Construction loan 2Sep 03, 2021 9:36 pm Chan Cheu I just want to know when i buy a land and paid LMI for land amount $180000 and then for construction loan if i put deposit 10% Do i need to pay LMI only for construction loan or Both Land and construction? You only need to pay LMI for the new lending from your construction. At the time you finish your plan, the bank will do another TOC valuation, if the land value has increased, it may save you money on LMI. Re: LMI for Construction loan 3Sep 03, 2021 9:42 pm Flamingo Chan Cheu I just want to know when i buy a land and paid LMI for land amount $180000 and then for construction loan if i put deposit 10% Do i need to pay LMI only for construction loan or Both Land and construction? You only need to pay LMI for the new lending from your construction. At the time you finish your plan, the bank will do another TOC valuation, if the land value has increased, it may save you money on LMI. Thanks It looks like i paid for both.The house is under construction at frame stage now and on the loan contract LMI amount is more than Land loan i have paid. Re: LMI for Construction loan 4Sep 03, 2021 10:51 pm How many threads you want on this? You borrowed more 5han 80% on land. You pay lmi. You then at a later stage got a construction loan a period of time after your land loan settled. This increases your overall lend to the value of land +construction, which is still over 80%. You pay lmi o the total amount. You've effectively paid LMI twice because of how you structured your lending asa result of the timing between the two loans. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: LMI for Construction loan 5Sep 03, 2021 10:59 pm Chan Cheu Flamingo Chan Cheu I just want to know when i buy a land and paid LMI for land amount $180000 and then for construction loan if i put deposit 10% Do i need to pay LMI only for construction loan or Both Land and construction? You only need to pay LMI for the new lending from your construction. At the time you finish your plan, the bank will do another TOC valuation, if the land value has increased, it may save you money on LMI. Thanks It looks like i paid for both.The house is under construction at frame stage now and on the loan contract LMI amount is more than Land loan i have paid. It’s a land & build package, you pay LMI to the entire loan. LMI is based on your LVR, total lending against your house “as if” complete value. What do you mean you paid double? Re: LMI for Construction loan 6Sep 04, 2021 12:35 am It wasn't a house and land. He got a land loan 1.5 years ago at over 80%. Paid LMI. Now he's refinanced it to include a construction loan as well. Total lend still over 80%. LMI is reapplied as it a new loan over 80% LVR. He paid LMI twice because of poor structuring and timing and low deposit. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. Re: LMI for Construction loan 7Sep 04, 2021 4:58 pm You only need to pay LMI for the new lending from your construction. At the time you finish your plan, the bank will do another TOC valuation, if the land value has increased, it may save you money on LMI.[/quote] Thanks It looks like i paid for both.The house is under construction at frame stage now and on the loan contract LMI amount is more than Land loan i have paid.[/quote] I see. Normally, bank won’t charge LMI again for the amount you paid before unless if you restructure your original land Loan e.g changed your loan term, you will be subject to LMI for the entire loan. He should check with his Bank’s lending manager as different bank may have different policy. Re: LMI for Construction loan 8Sep 05, 2021 12:36 pm When you paid LMI on the land, it only covers the land loan amount, let say if the land value is $300,000, loan were 90% LVR, the Loan is $270,000 and LMI premium would be around $4,000. Assume construction cost is 400,000 and the bank "as if complete" valuation comes back for $700,000 and the construction loan required is $360,000 and the total LVR still at 90%, the total LMI premium would be calculated on the total loan of $630,000 which will come to around $15,000. You will only be required to pay the difference of $11,000 because you have paid the $4,000 as part of the land loan. Re: LMI for Construction loan 9Sep 06, 2021 7:10 am Aaf When you paid LMI on the land, it only covers the land loan amount, let say if the land value is $300,000, loan were 90% LVR, the Loan is $270,000 and LMI premium would be around $4,000. Assume construction cost is 400,000 and the bank "as if complete" valuation comes back for $700,000 and the construction loan required is $360,000 and the total LVR still at 90%, the total LMI premium would be calculated on the total loan of $630,000 which will come to around $15,000. You will only be required to pay the difference of $11,000 because you have paid the $4,000 as part of the land loan. Nope. They refinanced to include the construction loan a year and half later. It's a new loan, new full LMI. Dark matter scientist, can breathe underwater, mind reader and can freeze matter just by willing it. Trust me, its in my sig. The biggest challenge will be if you take out a loan and then run out of money - you'll have an incomplete security and lenders do not like this so you can get stuck.… 2 19114 brokers will also be in a position to get you a better rate than the advertised rate most times. 6 7586 Hi, you've probably already resolved this, however, Commbank will probably pay the funds to you after you send evidence the work is done regardless the change in the quotes. 1 35332 |