Alt-A

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Dictionary Says

Definition of 'Alt-A'

A classification of mortgages where the risk profile falls between prime and subprime. The borrowers behind these mortgages will typically have clean credit histories, but the mortgage itself will generally have some issues that increase its risk profile. These issues include higher loan-to-value and debt-to-income ratios or inadequate documentation of the borrower's income.
Investopedia Says

Investopedia explains 'Alt-A'

These types of loans are attractive to lenders because the rates are higher than rates on prime classified mortgages, but they are still backed by borrowers with stronger credit ratings than subprime borrowers. However, with the higher rates comes additional risk for lenders because there is a lack of documentation - including limited proof of the borrower's income.
Search results for

'Alt-A'

  • Too Good To Be True: The Fall Of IndyMac

    http://www.investopedia.com/articles/economics/09/fall-of-indymac.asp
    ... While it is usually difficult to pinpoint why certain companies failed when it came
    to IndyMac, there are two suspects: Alt-A loans and reverse mortgages. ...

  • Self Employed? 5 Steps To Scoring A Mortgage

    http://www.investopedia.com/articles/mortgages-real-estate/08/self-employed-mortgage.asp
    ... Low and no documentation loans are called Alt-A mortgages, and they fall
    between prime and subprime loans in terms of interest rates. ...

  • Case Study: The Collapse of Lehman Brothers

    http://www.investopedia.com/articles/economics/09/lehman-brothers-collapse.asp
    ... well under way, Lehman acquired five mortgage lenders, including subprime lender
    BNC Mortgage and Aurora Loan Services, which specialized in Alt-A loans (made ...

  • ADP Analyst Meeting: A Review

    http://stocks.investopedia.com/stock-analysis/2009/ADP-Analyst-Meeting-A-Review-ADP-FNM-FRE-XRX-ERIC0331.aspx
    ... The company does not own any subprime or ALT-A securities in this portfolio, and
    stresses safety of principal, diversification and liquidity when investing. ...

  • CDOs And The Mortgage Market

    http://www.investopedia.com/articles/07/cdo-mortgages.asp
    ... Complications To make matters a bit more complicated, CDOs can be made up of a
    collection of prime loans, near prime loans (called Alt.-A loans), risky ...

  • A Nightmare On Wall Street

    http://www.investopedia.com/articles/financial-theory/08/nightmare-banking-wall-street.asp
    ... The easy mortgages, especially the "Alt-A" and subprime loans, fueled a housing
    bubble that popped in 2007, as all bubbles ultimately do. ...

  • Financial Institutions: Stretched Too Thin?

    http://www.investopedia.com/articles/fundamental-analysis/08/loan-portfolio-analysis.asp
    ... Alt-A Paper: This is a mortgage that carries more risk than an A-Paper mortgage,
    but is less risky than subprime paper (described below). ...

  • Fannie Mae, Freddie Mac And The Credit Crisis Of 2008

    http://www.investopedia.com/articles/economics/08/fannie-mae-freddie-mac-credit-crisis.asp
    ... Mess Impact You?) In 2007, Fannie Mae and Freddie Mac began to experience large
    losses on their retained portfolios, especially on their Alt-A and subprime ...

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