Home Loans Explained
Video series to help you understand mortgage terms, mortgage process and how a mortgage works.
What are LEP or LEM Fees?
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In this video:
What LEP and LEP mean
When do you get an LEP or LEM
How LEP and LEM work
When you can remove an LEM
Read Transcript
What are LEP or LEM fees?
LEP stands for low equity premium and LEM stands for low equity margin.
They are one of the restrictions given by the lender when you have a less than 20% deposit and a high LVR home loan.
An LEP is a one-time fee that is paid on settlement day.
An LEM is an added percentage to your interest rate while the house is above 80% LVR. Once you have paid down your home loan and/or your house value has gone up, the LVR can reduce to 80% or below.
Once this happens the LEM is removed.
Many of our clients get their LEM removed after the first year of home loan repayments using our structure advice and repayment strategy.
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