a 100 percent mortgage

100% Mortgages cover the full price of the property and possibly a bit extra to cover initial moving fees. This type of mortgage is suitable for someone who is able to afford the repayments on a mortgage but has difficulty in raising capital for the deposit.

By covering 100% of the loan the lender is deemed to be exposing itself to greater risk and this will be reflected in the rates. A special fee called a Mortgage Indemnity Guarantee (MIG) may be applicable which could be added to the cost of the mortgage. This fee is charged by some lenders on loans of 90% or more to give them some protection against the borrower defaulting on the loan.

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