A loan in which the borrower faces challenges in financing because of poor credit or any situation that would cause them difficulty in obtaining funds from lenders.
Refers to mortgages that do not meet normal credit criteria or scores because of current and/or prior credit history. This type of mortgage is offered at a higher interest rate because of the risk to the lender or investor.
A home financing program that accommodates borrowers with special qualifying factors, including poor credit histories.
A mortgage for someone who does not meet conventional guidelines. The borrower may have damaged credit, own too many properties, of have a debt-to-income ratio that exceeds the conforming loan guidelines. These loans are considered to have a higher risk of default and hence carry a higher interest rate than conforming loans.