Mortgage Guarantee Insurance: An insurance agreement protecting the lender against loss. Mortgage insurance means that the lender, a Building Society for example, can confidently make advances for homes where the borrower has a lower equity than the accepted margin. The lenders are protected against loss on the loan should the borrower default on the repayments or other covenants of the mortgage. The mortgage insurer will reimburse the lender for the total amount of the loss, which may also include, costs of selling the property, essential repairs, and maintenance, unpaid rates and so on. Where a person defaults under the mortgage, and the mortgage insurer pays the lost amount to the lender, the borrower will remain liable for the loss.