Subprime lending is the provision of loans to people who may have difficulty maintaining the repayment schedule due to their weakened credit histories and a greater risk of loan default than prime borrowers. Here are some key points to understand about subprime lending:

• Credit Quality: The term "subprime" refers to the credit quality of particular borrowers, who have weakened credit histories and a greater risk of loan default than prime borrowers.

• Interest Rates: Subprime loans are offered at a rate above prime to individuals who do not qualify for prime-rate loans. The interest rate associated with a subprime loan is usually high to compensate lenders for taking the risk that the borrower will default on the loan.

• Credit Scores: Subprime borrowers typically have credit scores below 620 along with other negative information in their credit reports. Historically, subprime borrowers were defined as having FICO scores below 600, although this has varied over time and circumstances.

• Types of Loans: Subprime loans can be offered for various purposes, including mortgages, auto loans, and personal loans.

Subprime lending has been criticized for being predatory, as it can lead to borrowers being locked into debt or increasing their likelihood of defaulting. However, subprime lending can also provide access to capital for borrowers who have trouble getting low-interest rates, allowing them to invest, grow their businesses, or buy homes.