Subprime loans have higher loss rates than many other types of loans. Explain why lenders offer subprime loans. Describe the characteristics of the typical borrower in a subprime consumer loan.
Answer to relevant QuestionsExplain generally how smart cards, debit cards, and prepaid cards differ from traditional credit cards. What are the key provisions of the ECOA? Why was such legislation necessary? Explain how the design of a CMO supposedly helps to manage prepayment risk for investors. What is a tranche? Suppose that the U. S. Treasury yield curve is continuously downward- sloping. To maximize interest income over the next 10 years, should a bank portfolio manager buy securities with maturities of under 1 year or securities ...What types of securities are banks prohibited from buying for investment purposes?
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