Financial Glossary of Finance Terms Mortgage Indemnity Guarantee (MIG)

Mortgage Indemnity Guarantee (MIG) is an insurance policy designed to protect the lender from any loss in the event that they have to reposses and the value of the property when sold fails to meet the loan borrowed.

It is typically requested when the Loan to Value (LTV) is over a certain amount typically 75% and though it is to the benefit of the lender it is the borrower that has to pay for it. Worse still the insurance company still has the legal right to chase the borrower for the money it has paid out to the lender. This is however the cost for not having a more substantial deposit.

The Mortgage Indemnity Guarantee is an additional security fee or higher lending charge