Mortgage Crisis Resource Center

Do I have a subprime mortgage?

The main reason to determine if you have a subprime loan is to help you evaluate your options. You may qualify for a more affordable loan than you currently have. And even if you have good credit, that doesn't mean you have a prime loan – more than half of U.S. borrowers who have subprime loans have good credit. In addition, each lender uses their own criteria and considers other information such as income, other debt and property value when evaluating you for a loan, so your credit standing is just part of the equation.

Most subprime loans share common characteristics, so there are definitely ways to determine if you have a subprime mortgage. First get your loan documents out and answer the questions in the following checklist.

Enter your current mortgage details here:*

1. What was your FICO® score when you purchased your mortgage?**

2. Is your mortgage an adjustable-rate mortgage (ARM)?

3. Is your mortgage a 2/28, 3/27, or 5/25 ARM?

4. Do you have a pre-payment penalty?

5. When your ARM mortgage resets, what is the margin (the percentage points added to your rate in addition to your index adjustment)? If you have a fixed-rate mortgage choose 1-3%.

 

*This chart is illustrative only. No universally accepted definition of subprime currently exists.
**This is a general credit assessment and your FICO score, by itself, does not determine the type of (or terms of the) loan you might qualify for.

Now that you have some idea whether your loan is subprime, you can access your options for dealing with your mortgage.

Next


Was this article helpful? Give us feedback


myFICO is the consumer division of FICO. Since its introduction 20 years ago, FICO® Scores have become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use FICO Scores to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+