Mortgage indemnity guarantee 'would help FTBs'

Posted: 17 Nov 2011 11:50:46 GMT

First-time buyers could be helped by the reintroduction of a mortgage indemnity guarantee scheme.

Prospective first-time buyers (FTBs) could be handed a boost in their quest to purchase a home if a mortgage indemnity guarantee (MIG) scheme was reintroduced.

That is the opinion of Andy Pratt, chief operating officer at Alexander Hall, who believes the re-implementation of this initiative may provide the housing industry with a timely boost as it continues to struggle following the recession.

"It provides a certain level of security against a higher level of risk, so there is no reason why it shouldn't work because it has worked in the past," he said.

Last week, the Confederation of British Industry proposed that MIG - which offers protection for lenders - should be considered once again, while FTBs may also benefit if they were able to access pension savings to boost their deposits.

Mr Pratt agrees with this sentiment, but admitted reluctance among insurance companies could possibly be a "stumbling block" in any plans. 

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