Subprime lending

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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 ?
(1.) This article does not address issues presented by subprime lending in the auto finance or manufactured housing industries.
Oregon has remained relatively immune to the subprime mortgage crisis.
Gibson said that, nationally, subprime loans have represented a significant percentage of loans originated in the past 18 months.
The authors examine subprime mortgages (defined as mortgages to borrowers with FICO credit scores below 660) issued between 2002 and 2006.
TransUnions report found that origination growth in the subprime risk tier grew at a significant rate across auto, personal loans and credit cards following declines in 2017.
Much of my recent research focuses on understanding three key issues related to subprime mortgages and minority borrowers during the last housing cycle: the role of subprime loans during the housing boom, the foreclosure crisis, and the vulnerability of minority homeowners during the boom and bust.
Summit Financial Corp., a Plantation, Florida-based subprime car finance company, filed for bankruptcy late last month after lenders including Bank of America Corp.
Almost 9.7 percent of subprime car loans made by non-bank lenders have come close to default in the third quarter.
With their exorbitant and unavoidable fees, subprime specialist issuer cards can cost a consumer an average of $154 during the first year and $166 every year after that, while secured cards charge, on average, $26 in the first year and $19 in the following years, according to a NerdWallet (https://www.nerdwallet.com/blog/credit-card-data/consumer-credit-card-trends-study/) report released Tuesday.
While the recent 20-year high in subprime auto delinquencies merits close watch, it's important to note that this number is a fraction of the total number of subprime auto loans being originated.
Using data from Mintel and Experian, the CFPB found that in 2013 and 2014, subprime issuers sent more than half of their marketing mailings to households headed by consumers with no college education.
Many studies of the housing market collapse of the last decade, and the associated sharp rise in defaults and foreclosures, focus on the role of the subprime mortgage sector.