LMI Waiver for Teachers: Lender Rules 2026

A teacher LMI waiver lets an eligible teacher borrow up to 90% of the property value without paying lenders mortgage insurance (LMI). It’s only available from lenders whose waiver policy names teaching. As at October 2026, Bank First and Granite Home Loans publish teacher offers, and their tests are different.

Bank First takes first home buyers employed in the education sector who are ineligible for government schemes. Granite takes primary and secondary school teachers who are permanent full time and off probation at “GPS or public schools”. A teacher can pass one test and fail the other, so check the client’s role and employment against each lender’s own wording.

A waiver for other frontline roles covers teachers only when it lists them. People First Bank’s Essential Services Package waives LMI to 90% for nurses, paramedics and police, with no teaching category. Teachers Mutual Bank’s low-deposit options list the 5% Deposit Scheme, Help to Buy, paid LMI and a family guarantor, with no occupation waiver.

The LMI waiver guide compares how waivers work across other professions, so you can see which concessions belong to which roles.

Identify the Teaching Role

To check an LMI waiver for a teacher, start with the client’s employer and employment status, because these decide eligibility more often than the job title. Each lender defines the role differently, and a registered teacher can still fall outside a waiver.

Test	Bank First	Granite Home Loans
Role	Any employee in the education sector	Primary or secondary school teacher
School sector	Not limited in its published conditions	“GPS or public schools”
Employment status	Not stated in its published conditions	Permanent full time and off probation
Minimum income	None published	No minimum income requirement
Buyer type	First home buyer, ineligible for government schemes	Any eligible purchaser of an owner-occupied home

Registration

Registration shows that your client is a qualified teacher, but neither lender’s published conditions set a registration level. In Victoria, for example, teachers in schools and early childhood services must be registered with the Victorian Institute of Teaching. A graduate usually starts on provisional registration before moving to full registration.

Granite’s published test doesn’t mention registration level, so a provisionally registered graduate isn’t excluded by it. The deciding condition is employment: the graduate must be permanent full time and past probation. Use the state regulator’s public register to confirm the registration is current.

School Sector and Classroom Role

Granite’s 17 July 2026 product sheet covers primary and secondary teachers at GPS or public schools, so a government school teacher fits its wording. Catholic and other independent schools are less clear. Ask Granite whether the school falls within “GPS” before you quote the waiver.

As at October 2026, Bank First’s test is the education sector, not the teaching role. Its published conditions don’t name eligible employers, so a teacher’s aide, TAFE teacher or early childhood teacher isn’t ruled out. Granite’s role list doesn’t include those positions.

Income and Experience

Neither lender sets a minimum income for its teacher offer. Granite states that it has no minimum income requirement, and Bank First publishes none. The client’s income still has to service the loan under each lender’s normal assessment, which the teacher home loans guide covers.

Experience matters at Granite only through probation. A teacher in their first permanent role qualifies once probation ends. Bank First doesn’t publish a probation or experience rule.

Compare Offers

Compare the two teacher offers on maximum loan-to-value ratio (LVR), loan size and purchase type, then on how the client is employed. LVR is the loan amount as a percentage of the property value. Both lenders stop at 90%, but each puts different limits around that figure.

Condition	Bank First	Granite Home Loans
Maximum LVR without paid LMI	90%	90%
How LMI is avoided	Bank First doesn’t require LMI	Granite pays the LMI premium
Maximum loan	Not published	$2.5 million, subject to its postcode matrix
Purchase type	First home, owner occupied	Owner-occupied purchase, established or new
Excluded	Refinances, off-the-plan and construction loans	Construction and vacant land
Location	Postcode lending restrictions	Metro and inner-city locations only
Savings	10% deposit	$5,000 in genuine savings
Pricing above 80% LVR	Higher interest rate	Rate reductions on request as the LVR falls

Record LVR and Income Conditions

Record each lender’s LVR limit beside the conditions attached to it. As at October 2026, Bank First’s 90% is for first home buyers who can’t use a government scheme. A client who qualifies for the 5% Deposit Scheme is therefore outside Bank First’s waiver.

Granite’s 90% product, per its 17 July 2026 product sheet, needs full income documentation and a clear credit history. Borrowers must be Australian citizens or permanent residents.

Granite pays the LMI premium rather than waiving it. Your client pays no LMI either way. The difference is who pays the insurer, so compare each loan’s interest rate and fees before you recommend one.

Bulma’s Policy Advisor answers a waiver question across 52+ lenders and quotes the policy wording behind each answer. You can keep that wording in your file notes with the lender and the date Bulma last updated that policy.

Permanent Work and Relief Teaching

Permanent full-time employment is Granite’s dividing line. A permanent full-time teacher past probation can use the waiver. A casual relief teacher, part-time teacher or contract teacher doesn’t meet that wording.

Bank First’s published conditions don’t state an employment type. For a relief teacher, ask Bank First whether casual education work qualifies before you quote its waiver. The casual employment home loan guide explains how lenders assess casual income once the waiver question is settled.

A Worked Example

In this hypothetical case, two first home buyers each plan to buy an $800,000 home in Melbourne with an $80,000 deposit. Each loan is $720,000, which is a 90% LVR.

Mia is a permanent full-time secondary teacher at a Victorian government school, past probation. She meets Granite’s role and employment test, provided the property is in an eligible postcode.

Bank First’s waiver excludes her if the 5% Deposit Scheme is open to her at that price. In that case the scheme itself gives her a route with no LMI.

Sam works as a casual relief teacher across several schools, so he doesn’t meet Granite’s permanent full-time test. Bank First’s education-sector offer is the only one of the two that could suit him, depending on how Bank First treats casual employment. Like Mia, he’s excluded if the 5% Deposit Scheme is open to him.

Prepare Evidence

Collect proof of the teaching role and employment before you tell a client they qualify for a teacher LMI waiver. Each document answers one of the eligibility tests in the lender’s policy.

Document	What it proves	Check before you quote
Current teacher registration	The client is a registered teacher	Registration is current on the state register
Employer letter	Employer, school, role, permanent or casual status and probation	For Granite, it names a GPS or public school and states full time and off probation
Recent payslips	The client is paid by the stated employer	Employer name and pay match the letter
Employment contract	Permanent or fixed-term terms, and hours	Hours are full time for Granite
Lender confirmation	The lender accepts this role for its waiver	Written confirmation for any case outside the published wording

The employer letter carries most of the waiver test. Ask for it on school or department letterhead, dated within the lender’s acceptable period. It should state the role, school, employment basis and whether probation has ended.

Get lender confirmation for any case the published wording doesn’t settle. Examples are a Catholic or independent school at Granite or a casual teacher at Bank First. Quote the waiver only after the lender confirms it in writing.

When No Waiver Applies

When your client doesn’t meet a teacher waiver, their deposit and eligibility decide which of four routes comes next. They are ordinary LMI, the 5% Deposit Scheme, a guarantor or a lower LVR.

A doctor’s, nurse’s or police officer’s concession doesn’t extend to teachers. The nurse LMI waiver guide shows how those offers set their own role tests.

Ordinary LMI applies when the loan is above 80% of the property value. According to Moneysmart, LMI protects the lender rather than the borrower. It’s usually a one-off cost to your client.

The Australian Government 5% Deposit Scheme lets eligible first home buyers buy with a 5% deposit and no LMI. Single parents or legal guardians can buy with 2%. Since 1 October 2025 the scheme has no income caps, but property price caps still apply by location, as the 5% Deposit Scheme guide explains.

A family guarantor can bring the loan under the lender’s LMI threshold by offering security over their own property. The guarantor takes on real risk. Moneysmart’s guarantor page warns they may have to repay the whole loan plus interest, and the guarantor requirements guide covers lender conditions.

A 20% deposit brings the loan to 80% LVR, where lenders generally don’t charge LMI. For a teacher just outside a waiver, compare that saving time with the LMI premium on a 90% loan, then choose the route that fits your client’s timing.