Because of securitization,a new class of residential mortgages offered to borrowers with less-than-stellar credit records developed. These mortgages are known as
A)risk-enhanced mortgages.
B)subprime mortgages.
C)bundled mortgages.
D)adjustable-rate mortgages.

Question

Quizplus · Accepted Answer

The passage states that "Because of securitization, a new class of residential mortgages offered to borrowers with less-than-stellar credit records developed." This new class of mortgages is commonly referred to as subprime mortgages. Therefore, the correct choice is B.

Because of Securitization,a New Class of Residential Mortgages Offered to Borrowers