Explore the different types of subprime home loans, including fixed-rate, interest-only, and adjustable-rate options. Understand the risks and benefits associated with borrowing with poor credit. Get tips on comparing lenders and making informed decisions for your mortgage needs.

Subprime mortgage loans are designed for borrowers with credit scores below 640 or no credit history. The Federal Deposit Insurance Corporation notes these individuals often face financial challenges like past delinquencies, bankruptcy, or low income. Those who missed at least two payments in the previous year are also considered subprime. Due to the increased risk for lenders, these loans come with higher interest rates. There are various types of subprime mortgages tailored to borrowers with poor credit, each with distinct features and repayment terms.

Types include long-term fixed-rate loans, interest-only plans, adjustable-rate mortgages, and specialized options like the Dignity Mortgage. Borrowers are encouraged to compare lenders to find the best fit for their financial situation. Subprime loans, while risky for lenders, are often highly profitable and accessible to those with low credit scores.

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Note: Our blog provides informational content; it is not professional financial advice. Always verify details and consider your personal circumstances before choosing a mortgage plan.