Lenders Mortgage Insurance (LMI) refunds: What you need to know

LMI is one of several additional costs often incurred when buying property. Generally, if you're borrowing at a loan-to-value ratio (LVR) above 80%, you'll likely need to pay for LMI (unless you're eligible for an exemption).

LMI premiums can be a significant expense. For example, if you're borrowing $500,000 to buy a $600,000 property (LVR of 83.33%), you might pay around $4,000 in premiums (estimated using our LMI calculator). That cost typically increases alongside loan size and LVR.

But if you've already paid for LMI, you may be entitled to a partial refund.

Who might be eligible for a Lenders Mortgage Insurance refund?

An LMI policy covers the entire loan term, usually 20 to 30 years. If you repay the loan within the first couple of years, much of the policy goes unused – and it’s reasonable to wonder whether you can get some money back.

In practice, refunds are generally only available if the loan is paid out in full within two years of settlement. Even then, they’re usually capped at around 40% to 50% of the premium. Policies vary between lenders and LMI providers.

Importantly, you don’t always need to repay the balance yourself. Refinancing a mortgage sees the original loan paid out with funds from the new one, which could also make you eligible for a refund.

Is LMI transferable when refinancing?

If you're refinancing to a different lender, you might hope to transfer your LMI policy across. Unfortunately, that’s not possible.

While refinancing may trigger a refund on your old loan, if your LVR is still above 80%, you might need to pay for a brand-new policy with your new lender. To avoid a new LMI policy, you'll need to have a lower loan balance or a higher property value than you started with.

Which lenders offer refunds on mortgage insurance?

There is no set rule on when LMI refunds are granted. It depends on both the lender and the LMI insurance provider.

Here are the general policies at each of Australia's big four banks:

Lender	LMI provider	Refundable portion of LMI premiums
CommBank	Helia (switching to Arch from 2026)	Non-refundable at the time of writing
Westpac	Westpac LMI	Up to 40% if the loan is repaid within 12 months, or 20% if repaid in 12 to 24 months
NAB	QBE	Up to 40% if the loan is repaid within 12 months. If the loan was issued between November 2019 and June 2024, a 20% refund may be applicable if it's repaid in 12 to 24 months.
ANZ	ANZ	Up to 50% for loans repaid within 12 months, or 25% if repaid in 12 to 24 months

Other conditions may also apply in order for a borrower to be eligible for an LMI refund.

For example, in many cases, customers are ineligible for a refund if the loan has been in arrears.

How to get an LMI refund

If you think you might be entitled to an LMI refund, you'll usually need to contact your lender rather than the insurer. Since the LMI policy is taken out by the lender, it's the party that needs to request a refund.

If you're eligible for a refund you should be proactive. Reach out as soon as possible and follow up if needs be.

Lenders like QBE and Helia limit how long refund requests can be made after the loan is paid off so you might need to chase your lender to make sure this gets done.

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