We offer a wide variety of products and services that can help lenders broaden their markets while lowering credit-related risk:
Primary Mortgage Insurance or Guarantees: AIG United Guaranty subsidiary companies provide first-loss credit protection coverage up to a specified maximum amount per loan, tailored to the lender’s risk preference for each LTV “band” or level. The base product is designed for home purchases financed by local currency amortizing loans, but AIG United Guaranty can design custom programs for other types of loans, including interest-only, foreign exchange, revolving mortgages, second homes, second liens, and self-construction.
Secondary Market Credit Enhancement: AIG United Guaranty can help improve the value of loans offered for sale to investors through customized portfolio insurance for groups of loans. Beyond simple credit protection, investors value the underwriting diligence and risk-monitoring services offered with these products.
Ordinary and Structured Capital Relief: In some markets, banking supervisors value our credit protection by allowing lenders to reduce their required capital when high-LTV loans are insured. In other markets, a more customized approach is needed. Together with other AIG affiliates, we can help meet a wide variety of lender needs for risk, funding, and balance-sheet management.
Broadened Customer Base: Low-down-payment loans are riskier, and lenders make fewer of them when forced to retain all the additional risk, especially if they are inexperienced with these types of transactions. The global experience and practical support provided by AIG United Guaranty can be adapted to a variety of loan programs, enabling more loans for a broader range of borrowers.
Improved Mortgage Loan Underwriting: Because AIG United Guaranty puts its own capital at risk whenever it agrees to insure loans, our underwriting programs reflect a deep understanding of mortgage risk factors – experience we’ve developed in both international and U.S. mortgage markets. We use Internet-based and shared electronic applications to ensure accurate underwriting of loans in any market.
Continuous Innovation: When addressing the needs of a specific market, new ideas come from understanding what works in other markets and what capabilities can best be applied to create effective solutions. Whether a market needs more efficient “bundled” credit protection, a consistent approach across multiple lending environments, or an expansion of our credit protection expertise to other asset categories, no other financial services provider matches our willingness and ability to provide practical solutions for lenders and investors throughout the world.