Glossary: Mortgage indemnity guarantee

An insurance policy taken out by a lender to protect itself from the risk of the borrower, falling behind with payments or if the lender has to repossess the property and sell it for less than the outstanding mortgage secured on it. Lenders impose MIGs on borrowers or property they perceive to be risky and although the MIG acts as a form of additional security for the lender, the borrower pays for it, even though it offers the borrower no additional security whatsoever.

Relevant to: Mortgages

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