Introduction to Subprime Mortgages

Subprime mortgages are loans for real estate that are granted to individuals who do not have the ability to obtain a prime mortgage. This means that the borrower's ability to repay the loan is questionable based on a number of criteria.

Here is what would make a borrower be considered a subprime borrower.
o FICO Score of 660 or less.
o Late payments to any creditor within the last 12-24 months.
o Collection accounts.
o Any repossessions within the last 5-7 years.
o Bankruptcy within the last 7 years.

There may be other circumstances that would give a lender reason to consider a borrower as subprime. However, the above list are key reasons. If your current situation includes anything on the above list, any loan you apply for will be underwritten as a subprime loan. Your interest rate and fees charged for the loan will be higher at this rate. Loans to questionable borrowers are becoming increasingly difficult to obtain.

Lately the subprime lenders have run into a lot of financial trouble. The default rate on this type of loan is at an all time high and people are losing their homes at an alarming rate. Several large lenders that specialized in loans to questionable borrowers have filed for bankruptcy. This is why the news is full of stories about the subprime mortgage crisis.

There are many subprime mortgage lending resources on this site. Do come back more often for more updates. Here are some of the article highlights

What Is Subprime Lending - What is subprime lending? The definition of subprime lending is the loaning of money to people who are at a higher credit risk than normal

What Is Subprime Mortgage Lending - Many people do not know exactly what is subprime mortgage lending. Here is a good look at what subprime mortgage lending is and how it started to be blamed for the real estate woes we are seeing today

Interagency Guidelines On Subprime Lending - Interagency Guidance on Subprime Lending are several documents that were developed by multiple governmental agencies to deal with the growing subprime lending market.

Subprime Lending Crisis - What is the subprime lending crisis and what caused it. Is it really the banks and irresponsible borrowers fault or is there more than meets the eye?

Subprime Lending Lawsuits - Subprime lending lawsuits abound. Here we look at some of the major players over the past few years to see what really has been going on.

Subprime Lending Scandal - Was there a subprime lending scandal: you bet there was. With so many subprime lenders having monetary difficulties, it is clear that there were deceptive lending practices. Let us take a look at this scandal.