AIG enters securitization game

by Allie Sanchez21 Jun 2017
Insurance giant American International Group (AIG) announced that it is turning to residential mortgages to compensate for lost revenue that resulted from the sale of its mortgage guaranty unit, United Guaranty, to Arch Capital Group last year.

HousingWire reports that the company has been shopping for high-quality jumbo mortgages and has plans to securitize these loans.

Quoting a pre-sale report from credit ratings firm Fitch Ratings, HousingWire reported that AIG is making preparations to bring its first residential mortgage-backed securitization to market to the tune of more than $500 million backed by 850 jumbo mortgages.

Fitch further said that 100% of these loans are safe-harbor qualified mortgages with a weighted average original FICO score of 779, the highest-rated transaction rated by Fitch since the crisis.

The credit ratings firm further said that these loans have a low concentration risk, with the highest amounting to less than $1 million and backed by average liquid reserves of $200,000.

AIG acquired the loans from originators such as Finance of America Mortgage, Stearns Lending, American Pacific Mortgage Corp and Cornerstone Home Lending.

Fitch handed out $484.58 million in AAA ratings to the deal, HousingWire reported.

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