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Guaranty Fee

Definition - What does Guaranty Fee mean?

A guaranty fee is a charge that is instituted by mortgage-backed securities for the purpose of bundling, servicing, selling, and reporting to the MBS investors; and for the purpose of covering various internal expenses. A guaranty fee is legally mandated to not be higher than an amount set by the government in any transaction.

Justipedia explains Guaranty Fee

Guaranty fees are sometimes called "g-fees." The common rate of a g-fee is not to exceed .50 basis points, or .5% of the total.

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