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St George is set to waiver LMI charges for owner-occupier first home loans on principal and interest repayments, with a maximum loan size of $850,000 on a $1 million property.
St George Bank has slashed its lenders mortgage insurance (LMI) charges to just $1 for qualified first home buyers borrowing up to 85 per cent of the property value.
On the maximum mortgage amount, the first home buyers would need to come up with a $150,000 deposit to avoid paying a one-off LMI fee of $21,465.
LMI is generally needed when home buyers have less than 20 per cent deposit, as an insurance cover that protects the bank if borrowers default on their mortgages.
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St.George general manager Ross Miller said their research shows one of the biggest hurdles for first homebuyers to overcome is the time it takes to save for a deposit, despite being in the financial position to make home loan repayments. 
“We are seeing many pain points experienced along that savings journey, including giving up holidays, reducing entertainment expenses, having to move back home with parents, moving in with friends or even leaning on family members to help top-up savings", Miller added.
“By reducing the expense of Lenders Mortgage Insurance, first time purchasers may be able to afford a property that meets their needs sooner and save thousands of dollars.” 
St.George research showed one in every 10 Australians looking to buy a home are doing so for the first time and that the COVID-19 pandemic has made one third of Australians want to save for that goal quicker. 
“Australians have spent more time at home than ever before during the COVID-19 restrictions, and we are seeing a bigger trend in how the nation is re-evaluating their current living situation. For example, three quarters of people would now prefer to live in a house over an apartment,” Miller said. 
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St George Bank offers $1 Lenders Mortgage Insurance for owner occupiers

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Lenders Mortgage Insurance (LMI) has been suspended by insurance company QBE for new loans taken out by home buyers who work in industries that have been hit the hardest by the coronavirus crisis.
QBE have started notifying home loan lenders of the decision to suspend the coverage.
QBE have defended the decision, arguing that lenders would be inclined to curtail home lending in response to the pandemic.
“We expect responsible lending obligations would have put a stop to much of the lending to those impacted by the COVID-19 crisis,” a QBE spokesperson told Banking Day. 
“The temporary embargo was issued to all of our lenders.” 
ASX-listed bank Auswide had sent a note to mortgage brokers on Monday regarding the LMI suspension.
“Mortgage insurers yesterday (Sunday) advised that in response to what is a rapidly changing environment they are imposing a temporary embargo on applicants working in the industries most directly impacted by COVID-19,” Auswide told brokers.
“Effective immediately a temporary embargo is in place on all new applications received for applicants working in the industries directly impacted by COVID-19, for example those working in gymnasiums, beauty salons, tourism and hospitality industries.
“Exceptions may be considered by the mortgage insurers on a case by case basis.”
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Mortgage insurance coverage for new loans suspended for high risk coronavirus workers

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Genworth Australia chief commercial officer Bridget Sakr says that consumers have some common misconceptions about lenders mortgage insurance (LMI), which are often due to a lack of understanding about what it is.
Sakr notes that they’re here to clear the record with <a href="https://www.genworth.com.au/lmifactually/welcome" target="_blank">LMI Factually</a> – a digital platform where property investors, first home buyers, mortgage brokers and industry leaders discuss LMI.
She says that misunderstandings may have deterred people from considering it as viable to help them enter the market.
“The reality is there are many consumers, brokers and leading business figures who are advocates for the product and even use it personally,” she explains.
This has spurred on a series of video interviews with leading industry figures such as Century 21’s Charles Tarbey, Finance Made Easy’s Tony Bice, Aussie Home Loans’ John Symonds and Empire Property Portfolios’ Chris Gray.
“LMI Factually aims to showcase a number of these views while encouraging Australians to learn more about the product and decide whether it is an appropriate product for their circumstances,” said Sakr.
“Achieving the dream of homeownership is one of the most exciting accomplishments in life for many Australians. However, it can also be one of life’s most difficult challenges due to the length of time it takes for most people to save the traditional 20 per cent deposit.”
If you want to know more about LMI, you can read this article where <a href="/expert-insights/finance/how-buying-lenders-mortgage-insurance-can-allow-you-to-grow-your-property-assets-faster">Chan &amp; Naylor’s Albertus Waldron explains how it can get you into a property quicker</a>.
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