If you read our previous blog about who qualifies for LMI waivers, you may also benefit from this one. We're exploring how legal professionals can potentially get the exclusively designed LMI waiver home loans for lawyers in Australia.

In this guide, you'll get a closer look at the eligibility and application process of major banks for lawyer home loans.

LMI Waiver for Lawyers in Australia: Get Zero-LMI Home Loans for Lawyers

Lenders Mortgage Insurance (LMI) is an insurance premium a borrower is required to pay when their Loan-to-Value Ratio (LVR) is above 80%. Keep in mind that this premium is for the lender, paid by you to ensure the lender is financially protected in case you default on the mortgage.

However, to mitigate this, certain professionals can benefit from waiver schemes to avoid paying LMI altogether, even if their LVR goes above the common threshold. Currently, we have:

• LMI Waiver for Teachers.

• LMI Waiver for Nurses in Australia.

And now, we have home loans for lawyers with zero LMI for high LVR applicants.

Are you a lawyer? This guide might just save you thousands on your next mortgage.

Home Loans for Lawyers in Australia

If you are a lawyer who wants to take out a home loan, you are likely to apply and get approval for a higher loan and be eligible for discounts with minimal risk to the lender. This is because lawyers are usually seen as high-income professionals with better job stability compared to other professions.

Therefore, as a potential high-paying customer, lenders will offer you an LMI Waiver through exclusive lawyer home loans. This means you could buy your desired property without making a significant deposit, while saving thousands of dollars on LMI and other fees.

In most cases, you can get as much as 90% LVR without paying LMI. But by involving a mortgage broker for negotiations and having an exceptional credit + financial standing, you could even get as much as 105% LVR at zero LMI!

LMI Waiver for Lawyers: Why LMI and Waivers Matter for Lawyers

When you apply for a home loan, the lender will calculate your LVR to determine how much they are willing to lend you against the value of the property you want to buy.

A low LVR is good; however, if the average person is not able to pay a 20% deposit and consequently wants to borrow more than 80% of the property's value, lenders will consider it a higher risk.

In this case, the lender will add a one-off, non-refundable and non-transferable Lenders Mortgage Insurance (LMI) premium to the home loan as an extra level of protection. This is paid by the borrower for the lender, which will protect the lender against any loss in case of mortgage default.

Nevertheless, although LMI is a one-off fee, it can be extravagant, for example:

A first-time buyer in New South Wales who wants to buy a house worth $500,000, will need to put down a deposit of $100,000 (20% of the property’s value). If they only saved up $50,000 and want to borrow $450,000, they may have to pay LMI.

Using the above suggested example to calculate the LVR, the loan amount is divided by the purchase price, then multiplied by 100.

$450,000 ÷ $500,000 = 0.9 x 100 = 90%

This means that they want to borrow more than 80% of the purchase price, so they may have to pay LMI of $7,003 to $10,483. Most lenders prefer to add this to their total loan amount so that they can pay it off as part of their monthly repayment amount. Alternatively, it can be paid in full at settlement.

The lawyer benefits...

However, if you are a lawyer who earns a sufficient income to support a loan, you may be able to capitalise on LMI. The legal profession offers job security and a professional status. In addition to that, historical data shows that legal professionals have lower default rates on loans.

This career stability drives lenders to push out exclusively designed home loans for lawyers, offering higher LVRs at zero LMI.

With an LMI waiver for lawyers, you will not have to pay any of the above-mentioned extra costs, which is a potential savings of $7,000 to $40,000!

Zero-LMI Home Loans for Lawyers: Eligibility Criteria

Your line of profession, as well as your high income and long-term career prospects, puts you in a favourable financial position to be eligible for a lawyer home loan. But here's what the exact eligibility criteria looks like:

• Australian permanent resident or citizen.

• Living and working in Australia as a lawyer.

• Earning a gross income of $150,000 or more.

  • For self-employed lawyers: last year’s taxable income needs to be $150,000 or more, and the loan amount may not exceed $2,000,000.

  • A lawyer couple who don’t individually earn an annual income of $150,000, but have a combined income that exceeds $200,000 may still be able to apply for the LMI waiver, depending on the lender.

Member of Industry Association

Some lenders may also require you to be a member of any of these industry associations:

• Law Council of Australia.

• Law Society of NSW.

• Law Society of South Australia.

• Queensland Law Society.

• The Australian Bar Association.

• Law Institute of Victoria.

• Australian Labour Law Association.

• Australian Corporate Lawyers Association.

• The Commercial Law Association of Australia.

• Australian Insurance Law Association.

Documents Required for Lawyer Home Loans

When applying, you will need documents proving that you fulfil certain requirements. Usually, you'll need to submit these required documents, but more items may be required depending on the lender:

• Proof of identity.

• Proof of income.

• Current practising certificate that permits you to practise in your State or Territory, issued by any of these following state or territory bodies:

  • Victorian Legal Services Board.

  • Law Society of the Australian Capital Territory.

  • Law Society of New South Wales.

  • Law Society of Northern Territory.

  • Law Society of Queensland.

  • Law Society of South Australia.

  • Law Society of Tasmania.

  • Legal Practice Board of Western Australia.

Evidence of membership

If your lender also requires you to be a member of an industry association, you will need to submit evidence of membership. You can submit any of these acceptable forms of evidence:

• Receipt for payment of annual membership.

• Current valid membership card.

• Written confirmation from the listed association.

• Practising Certificate.

Home Loans for Lawyers: Get Your FREE Zero-LMI Lawyer Home Loan Quote

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LMI Waiver Home Loans for Lawyers: FAQs

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How much can I borrow with LMI waiver for lawyers?

You can expect to borrow up to 90% LVR with zero LMI. However, by involving a mortgage broker for negotiations and having an exceptional credit + financial standing, you could even get as much as 105% LVR!

How much can I save with an LMI waiver home loan for lawyers?

This depends on the value of the house and your LVR. For a $500,000 house with a 90% LVR, you could save $7,003 to $10,483 if you buy it with a lawyer home loan.

Can junior lawyers or graduates apply for a lawyer home loan?

Lenders usually prefer fully qualified, practicing lawyers. Junior associates may still qualify, but the waiver is generally tied to practicing certificates and employment stability.

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