The short version
- Some lenders waive lenders mortgage insurance for accountants borrowing up to 90% of the property's value.
- You'll usually need to be a member of a recognised accounting body, such as CA ANZ, CPA Australia or the IPA.
- Some lenders set a minimum income for the waiver.
Banks and other lenders place accountants in a low-risk category for lending money since it is a relatively high-paying profession. Some lenders offer accountants lower interest rates and Lenders Mortgage Insurance (LMI) waivers, usually up to 85% or 90% LVR, in order to attract new customers.
If you are an accountant applying for a home loan, here's what you need to know.
LMI waivers for accountants
Typically, home loan applicants have to take LMI when the deposit is less than 20% of the property's value.
As an accountant you may be able to borrow up to 85% or 90% LVR without having to take LMI on your property, with lenders that offer a waiver to accountants.
LMI waivers are lender policies that change often, and the professions, deposit limits and conditions differ between lenders. Check the current policy with the lender or a mortgage broker before you rely on one.
Eligibility criteria
Banks will require evidence of your qualifications, association memberships, and income as proof of eligibility to have LMI waived.
Qualifications and memberships
You usually need to hold a full membership designation (such as CA, CPA, FCPA or FIPA) with one of the following professional bodies. Some lenders also accept actuaries and financial analysts:
- Chartered Accountants Australia and New Zealand (CA ANZ)
- CPA Australia (CPA)
- Institute of Public Accountants (IPA)
- Actuaries Institute (FIAA), accepted by some lenders
- CFA Society Australia (CFA), accepted by some lenders
Lenders will accept a payment receipt for annual membership, a current and valid membership card, confirmation in writing from the relevant association or a practising certificate as proof.
Income requirements
A few lenders have no minimum income for accountants, while others do. Where they apply, they have often differed by state and territory, for example:
- WA, SA, NT & TAS: $120,000
- NSW, ACT, VIC and QLD: $150,000
Your income can be the sum of regular income and any rental income. Some lenders only count your spouse's income towards the minimum if your spouse is also an eligible accountant. There may be limitations on how much you can borrow.
Some lenders also reduce the income documents they ask for from partners of large accounting firms who borrow less than 80% of their property's value.
When you apply for a home loan as a partner of an accounting firm, most lenders will ask for details of the company's financial performance, including corporate tax returns, in order to verify your ability to repay.
This requirement may be waived if you apply using an experienced broker.
Considerations
Should you go with a professional package?
Professional packages cater to those who plan to borrow larger amounts, often $150,000 or more, and are interested in more than just a home loan.
Banks offering professional packages may charge a single annual fee, often around $400, rather than an annual fee per loan or account included in the package.
LMI waiver for accountants with overseas qualifications
If you are not a member of any of the professional accounting bodies listed above, have a foreign accounting qualification, and are allowed to work in Australia, you may benefit from working with an experienced mortgage broker who can help convince lenders to waive the LMI.
Consider working with a mortgage broker
Mortgage brokers have access to loans from many lenders, and know which ones currently offer waivers to accountants. They can compare interest rates, fees and repayments for you, and must act in your best interests by law.