Subprime Credit

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Dictionary Says

Definition of 'Subprime Credit'

General term for borrowings of subprime debt, or loans made to people with less-than-perfect credit or short credit histories. Subprime credit includes the original borrowing itself, as well as any derivative products such as securitizations that are based on subprime loans and then sold to investors in the secondary markets.

A big portion of the total market for subprime credit is based on subprime mortgages, or home loans to borrowers of questionable creditworthiness.
Investopedia Says

Investopedia explains 'Subprime Credit'

Subprime credit has highly debated pros and cons; on the plus side it allows people who wouldn't otherwise have access to credit to obtain loans for things like automobiles, homes and credit cards. On the negative side, subprime credit can come with very unfavorable terms based on high interest rates, excessive fees and short grace periods.

Securities that use subprime credit as collateral have become widespread in the marketplace, with billions of dollars in collateralized debt obligations (CDOs) owned by investors that are based on the cash flows from subprime credit.
Search results for

'Subprime Credit'

  • How Financial Companies Encourage Bad Habits - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0411/How-Financial-Companies-Encourage-Bad-Habits.aspx
    ... Subprime Credit Cards For those people who have had some problems with their credit,
    sometimes the only way to start the rebuilding process is with a subprime ...

  • Dialing In On The Credit Crisis

    http://www.investopedia.com/articles/financial-theory/08/credit-crisis-mortgages-iphone.asp
    ... mortgage and credit crisis may never have happened. For all things
    credit-crisis related, check out our Subprime Mortgage feature. ...

  • What is a subprime mortgage?

    http://www.investopedia.com/ask/answers/07/subprime-mortgage.asp
    A subprime mortgage is a type of loan granted to individuals with poor credit histories
    (often below 600), who, as a result of their deficient credit. ...

  • Subprime Lending: Helping Hand Or Underhanded?

    http://www.investopedia.com/articles/basics/07/subprime_basics.asp
    ... In most cases, subprime borrowers have questions marks surrounding them in one or
    more of these areas, such as a poor credit rating or an inability to prove ...

  • The Causes And Effects Of Credit Shocks

    http://www.investopedia.com/articles/economics/08/credit-shock-mortgages.asp
    ... Conclusion Credit shocks are caused by many factors such as subprime loans,
    lack of regulatory oversight, low interest rates and politics. ...

  • How Will The Subprime Mess Impact You?

    http://www.investopedia.com/articles/pf/07/subprime-impact.asp
    ... read Subprime Lending: Helping Hand Or Underhanded?) With the recent meltdown in
    subprime markets, investors are now more aware of the credit risk inherent in ...

  • Credit Crisis: What Caused The Crisis? | Investopedia

    http://www.investopedia.com/university/credit-crisis/credit-crisis4.asp
    ... Subprime mortgages are issued to households with below-average credit or income
    histories and are generally considered more risky than traditional "prime ...

  • Who Is To Blame For The Subprime Crisis?

    http://www.investopedia.com/articles/07/subprime-blame.asp
    ... credit arbitrage". It involves purchasing subprime bonds on credit and hedging
    these positions with credit default swaps. This amplified ...

  • Subprime Is Often Subpar

    http://www.investopedia.com/articles/pf/07/subprime.asp
    ... market, a subprime mortgage borrower has a great deal of incentive to repair or
    establish his or her credit to be able to refinance the subprime mortgage into ...

  • The Fuel That Fed The Subprime Meltdown

    http://www.investopedia.com/articles/07/subprime-overview.asp
    ... a financial crisis that centers on the US housing market, where fallout from the
    frozen subprime mortgage market is spilling over into the credit markets, as ...

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