How is the fee for lenders’ mortgage insurance paid?
Lenders’ mortgage insurance in most cases is charged as a one-off premium. The amount will vary depending on how much money is being borrowed and the size of the deposit, if any.
Depending on the lender, the type of loan and the lenders’ mortgage insurance product, it is often possible to add the premium to the borrower's overall loan amount. This avoids having an upfront payment and spreads the cost of the insurance over the loan as a whole. Borrowers should ask their lender about this option.
GST is payable on all lenders' mortgage insurance premiums and is included in the premium rate quoted by lenders. Subject to various State Government regulations, stamp duty may be payable on lenders' mortgage insurance premiums. Where applicable, this amount is included in the total premium quoted.