What's LMI and is it worth avoiding?

LMI (Lenders Mortgage Insurance) trips people up because the name makes it sound like it protects you. It doesn't — it protects the bank if you default on the loan. You're the one footing the bill though, and it's not small change — depending on your loan size and how low your deposit is, you could be looking at anywhere from a few thousand bucks to tens of thousands.

Paying LMI to get into the market now (rather than waiting years to save the full 20%) can genuinely make sense, especially if prices are rising faster than you can save. But if you're close to that 20% mark anyway, it's worth doing the maths on what LMI would actually cost you vs. just holding off a bit longer.