Sub-prime Mortgage

Importance: 0.71

Is a company: no

Is a proper noun: no

Synonyms

  • non-prime loan
  • near-prime loan
  • non-prime mortgage
  • sub-prime loan
  • near-prime mortgage
  • sub-prime lending

Definition of Sub-prime Mortgage

  1. A mortgage granted to a borrower considered sub-prime, that is, a person with a less-than-perfect credit report. Sub-prime borrowers have either missed payments on a debt or have been late with payments. Lenders charge a higher interest rate to compensate for potential losses from customers who may run into trouble or default.

Related Terms and Acronyms

  • Shared-Appreciation Mortgage (SAM) Acronym,
    • A mortgage loan where the lender or a third-party backer agrees to offer a highly reduced mortgage rate to the borrower in exchange of sharing profits when the property is sold.
    • A home loan in which the lender offers a below-market interest rate in exchange for sharing in the profit when the home is sold. Usually done only with private funds/lenders.
  • Mortgage Lender (ML) Acronym, Very Important,
    • A lender that offers mortgages, often through a mortgage broker.
    Used internally by mortgage brokers and mortgage lenders.
  • Bad Credit Loan Definition,
    • A loan taken out by someone with bad credit.
  • Private Lender Definition,
    • A lender not associated with a traditional lender.
  • Bad Credit Definition,
    • Someone who carries a higher credit risk.
  • Mortgage (mtg) Abbreviation, Important,
    • A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
  • Credit Report (CR) Acronym, Very Important,
    • A report on a loan applicant's willingness and ability to make payments in a timely manner in the past. This report is provided to the bank by an outside agency.
    A report that outlines the credit worthiness of an individual or entity.
  • Predatory Lending (PL) Acronym, Important,
    • Lending practices that are unfair, deceptive or fraudulent.
  • Debt Definition,
    • Money one person or firm owes to another person or firm.
  • Default Definition,
    • When a borrower fails to fulfill the obligations of a loan or lease.
  • Sub-prime Borrower Definition,
    • A borrower with a less-than-perfect credit report due to late payments or a default on debt payments.
  • Delinquent Mortgage Definition, Important,
    • A mortgage loan where the borrower fails to make payments as specified in the loan agreement.
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