Three of American International Group Inc.'s subsidiaries plan to take steps to provide payment assistance to certain nonprime borrowers as part of an agreement with the Office of Thrift Supervision. Among the types of assistance that is slated to be provided by the three subsidiaries - AIG Federal Savings Bank, American General Finance Inc. and Wilmington Finance Inc. - is the provision of more affordable loans to certain borrowers with a high risk of foreclosure. Certain borrowers may receive a partial refund of loan fees instead. The agreement pertains to mortgages originated in the name of AIG FSB by Wilmington between July 2003 and May 2006. Separately, AIG plans to donate $15 million over a three-year period to certain nonprofits to support financial literacy and credit counseling. The company previously set aside a reserve of $128 million pre-tax for the expected cost of implementing such programs and has since estimated that it will need an additional reserve of up to $50 million, inclusive of the $15 million donation.

Subscribe Now

Authoritative analysis and perspective for every segment of the mortgage industry

30-Day Free Trial

Authoritative analysis and perspective for every segment of the mortgage industry