2007-09-09 16:24:43 · 4 answers · asked by Anonymous in Business & Finance ➔ Personal Finance
A subprime lender is a lender that offers loans at rates below the prime lending rate. So they are attractive, low rates. The problem is that the loans usually have a catch, and not everyone appreciates what the catch is. One deal that they offer is adjustable rate mortgages. People sign up, pay all the fees and get locked in. Then the rates go up, and the borrower gets in trouble. There is a big story in the US right now because so many people are defaulting on these adjustable and special loan deals that they have signed up for.
2007-09-09 17:19:56 · answer #1 · answered by hottotrot1_usa 7 · 0⤊ 0⤋
A lender that granting credit to people with limited or tainted credit history. Note many times these loans are bundled up and sold to others so many hedge funds, banks and investors so they in essence become subprime lenders.
2007-09-09 23:31:59 · answer #2 · answered by iocook 2 · 0⤊ 0⤋
Someone who makes loans to people with a history of late payments ,
Or already has too much debt ,
Or can't document their income or
Have too little income to actually take on the mortgage they seek .
>
2007-09-09 23:30:54 · answer #3 · answered by kate 7 · 0⤊ 0⤋
They typically provide loans for borrowers with crappy credit.
2007-09-10 12:22:10 · answer #4 · answered by Nicki 3 · 0⤊ 0⤋