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Investments glossary

Guarantee Fees

The term guarantee fee refers to the sum of money paid to the issuer of a mortgage-backed security (MBS) by the holder. This charge helps the issuer pay for administrative costs and expenses related to the security and also cuts down on any risk or loss that may arise if any of the mortgages that back the security default. Also called g-fees, guarantee fees also refer to charges paid by a mortgagor to a guarantor for services rendered.

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