Hi there, I hope this isn't too dopey of a question, but I need...

Hi there, I hope this isn't too dopey of a question, but I need some advice on buying a second property.

I had a chat with the lenders at the bank our current mortgage is through and they were happy to give pre-approval for a second place and said it should all be fine to go ahead leveraging off our current property, however, they said that LMI would need to be paid on the total amount borrowed across both properties once we bought the second one, which is pushed up past the $500,000 threshold making it more expensive.

My issue with this is that we've already paid mortgage insurance on the first place, it doesn't make a huge amount of sense to pay it again. He said that you can apply to have it reimbursed after the fact, but the approval rate is hit and miss.

Would it make more sense for me to extend our current home loan and then use the money from that as a cash deposit with another lender? Would that avoid the massive LMI by bringing it down under 500,000k again, and potentially raising the deposit percentage we have as well?

I do understand that a third option would be to save up a cash deposit but I would rather take advantage of our situation now and get a second place as soon as possible.

Thanks in advance to anybody that could shed some light on this!