Subprime lending

(redirected from Nonprime mortgage)

Subprime lending

Lending to individuals who have a bad credit history or relatively low income. A higher interest rate is charged for such loans because risk to the lender is higher. Excessive subprime lending is often pointed to as one of the major causes of the financial crisis of 2008-2009.
References in periodicals archive ?
Satisfactory Originator Review and Track Record (Positive): Fitch conducted an operational review of AOMS and AOHL and assessed them as 'Average' based on the companies' seasoned management team and extensive nonprime mortgage experience, a comprehensive sourcing strategy and sound underwriting and risk management practices.
It is not clear that anyone in the market or in government in 2007 and 2008 understood the dimensions of the nonprime mortgage problem.
Understanding the Boom and Bust in Nonprime Mortgage Lending
"We haven't come across inappropriate lending" in the nonprime mortgage market this year, says Beverley Budsworth, managing director of the Debt Advisor, which counsels consumers on debt issues.
he boom in nonprime mortgage lending that occurred in the United States between 2004 and 2006 was quickly followed by rapid increases in the rate of delinquencies and foreclosures on these loans.
Articles in The Village Voice likewise have drawn attention to how current New York State Attorney General Andrew Cuomo, as Secretary of HUD between 1997-2001, actively pushed Fannie Mae and Freddie Mac into backing the enormous expansion of the nonprime mortgage market.
Royal Media Group (New York), the publisher of "Auto Finance News," "Home Equity News" and "Collection Technology Magazine," among other information products, has launched "Nonprime Mortgage News." Designed to offer the nonprime mortgage market "more guidance and direction," the new publication focuses on four areas of importance for the nonprime mortgage market, including compliance, the correspondent market, technology and the professionals who influence developments in the sector.
Another form of nonprime mortgage is the Alt-A mortgage, which is usually a loan made to a borrower who has a relatively high credit score but lacks sufficient (or any) documentation of income.
Wells Fargo Steps To Success: Wells Fargo launched this free program in 2006 to help its nonprime mortgage borrowers manage and strengthen their credit.
nonprime mortgage sector,'' GM said in a press release.