American International Group (AIG) has set up a new business unit, known as Connective Mortgage Advisory, with an aim to identify and purchase residential mortgages for investments.
Leveraging AIG's investment expertise and the experience of its mortgage insurance subsidiary United Guaranty Corporation, the unit has facilitated the first correspondent mortgage purchase.
The US insurer will manage the loan-servicing component, for loans purchased for long-term investments purpose, the company said.
AIG investments and financial services executive vice president William Dooley said, "Direct investment in residential mortgage loans offers attractive investment returns and enables a proactive approach to managing mortgage risk."
In order to ensure hassle free operations, all purchases will undergo stringent underwriting and risk management standards, while closed loans will be purchased on a correspondent basis by the AIG companies.
The newly floated company will establish correspondent relationships with lenders, underwrite loans, and provide support throughout the loan purchase process.
International insurance organization AIG operates in more than 130 nations and regions and offers property-casualty insurance services to its customers.
