Investor Glossary-subprime loanInvestor Glossary-subprime loanInvestor Glossary-subprime loanInvestor Glossary-subprime loanInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Subprime Loan

The HTML to link to this page
 

A subprime loan is a loan given to a borrower at an interest rate higher than the prime rate. When a borrower has a low credit score, he may not qualify for a traditional loan, though he may qualify for a subprime loan. A subprime loan is also used when a borrower with decent credit prefers not to disclose his financial information. A borrower with high interest rate credit card debt can also opt for a subprime loan to save on interest payments. A subprime mortgage, a subprime credit card, or a subprime auto loan are all forms of a subprime loan. Subprime loan rates and terms and conditions of a subprime loan can vary significantly between lenders. In early 2007, the subprime loan market, in particular the subprime mortgage market, came under intense scrutiny when the subprime crisis began with a sharp increase in home foreclosures and subprime loan providers declaring dramatic losses or bankruptcy in some cases. This was the beginning of a major subprime crisis that ultimately affected other sectors of the US economy.



Rate this Subprime Loan definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: reverse mortgage, diluted share, stock market close, VIX, option premium, 401a, per diem, labor relations, deferred tax, inflation, current ratio, EBITDA, limit order, APR, retained earnings, balance sheet, wholly-owned subsidiary, phantom income, 1031 exchange, average price per share, class C shares, LIBOR, deferred revenue, in escrow, command economy, quality assurance, real GDP, covered put, Zero Cost Collar, minority interest, open position, Key Rate Duration, margin rate, ex-dividend, cancelled check, FICO score, stock split, liquidity ratio, 1035 exchange, dividends payable, 144a, annual return, FTSE, debt service coverage, implied volatility, risk management, irrevocable trust, required rate of return, ex-dividend date


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use