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AMI – reintroduce MIGs

AMI – reintroduce MIGs

Category: Mortgages

Updated: 12/03/2009
First Published: 12/03/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government has been urged to resurrect mortgage indemnity guarantees (MIGs) in order to help re-energise the mortgage market.

The Association of Mortgage Intermediaries (AMI) says the 2009 Budget represents the ideal opportunity to introduce measures that will help borrowers and intermediaries, and develop a stronger mortgage market.

By reinventing MIGs with a focus on consumer benefit, the trade body says lenders would be able to offer higher loan-to-value mortgages by making loans less capital intensive. This in turn would allow lenders to increase their capacity to lend, and extend the availability of mortgages to a wider range of consumers such as first time buyers.

The abolition of stamp duty on residential property and targeted tax free savings plans to help first time buyers save for a deposit are amongst the other proposals the AMI would like to see introduced.

"With the average deposit paid by first time buyers in November 2008 at 18% of the property's value, it is clear there also needs to be significant demand-side support," said Robert Sinclair, AMI director.

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