Subprime lending (also known as B-paper
, or second chance lending
) is the practice of making loans to borrowers who do not qualify for the best market interest rates because of their deficient credit history.
This word first came into prominence in 2007 with the global
subprime mortgage meltdown.
The prefix "sub" translates roughly to "below the standard," while "prime" means something close to "the best."
The Subprime mortgage meltdown has shaken the world's financial system.