Heavy losses sweep world markets

You can’t miss all this stuff in the news at the moment.  My dad tried to explain what sub-prime lending was .. anyway, the BBC has a description that explains it too.  Check it out: http://news.bbc.co.uk/1/hi/business/5144662.stm

What is sub-prime lending?

Put simply, it is loans to people who have patchy credit histories or cannot prove their incomes.

Sub-prime lending, which has become increasingly popular in the US and UK, takes several different forms.

In its simplest form, it involves doorstep lending – small amounts of cash loaned to people usually on low incomes and then collected from their own homes.

But there are also sub-prime mortgages.

This is when people borrow against the increased value of their homes, often to pay off other borrowings.

The term can also apply to mortgages taken out by people who are not attractive to mainstream lenders because of their credit history or employment status.

 

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