Despite many innovations in the lending process that made mortgage loans more accessible and affordable to the general public, many potential borrowers faced considerable barriers in qualifying for a loan and making a down payment. Which of the following types of loans was designed for a borrower with weak credit, those who seek 100 percent financing, or who cannot document their income?

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Subprime mortgage loans were designed for borrowers with weak credit, those who seek 100 percent financing or who cannot document their income. These loans have higher interest rates and fees compared to conventional prime home loans, and often have more lenient underwriting standards, making them accessible to those who would otherwise have difficulty qualifying for a mortgage. Affordable housing loans are generally meant for low- to moderate-income borrowers, and bridge loans are short-term financing options typically used to bridge the gap between the purchase of a new property and the sale of an existing one.

Despite Many Innovations in the Lending Process That Made Mortgage