Banks who lend heavily in sub-prime communities will face higher external finance premiums because the risk from holding assets composed largely of subprime borrowers is relatively high.
In 2007, the banking industry had essentially suffered and withstood their sub-prime lending losses at somewhere around $56 trillion worldwide.
The emergence of sub-prime loan losses in 2007 began the crisis and exposed other risky loans and over-inflated asset prices.
Such companies advertise in the same media as sub-prime lenders, supplementing this with door to door leaflet drops.
In 1998, he experienced a losing investment in sub-prime lenders.
Terms such as sub-prime lending, non-standard consumer credit, and payday loans are often used in connection with this type of consumer finance.
They allowed the sub-prime crisis to get out of control by continuing to give strong ratings to institutions that had packaged these devious products and sold them on.
These securities, backed by the sub-prime market, were bought on a massive scale by hedge funds mostly domiciled in tax havens, which are exempt from any regulation.
