Is subprime lending and predatory lending essentially the same thing?

  • Subprime and predatory leanding are essentially the same thing.

    Yes, subprime lending and predatory lending are basically the same thing. Subprime lending lends to those who have been proven unable to make their payments. Predatory lending gives loans to candidates with rather high interest rates with the knowledge that they are also going to be unable to pay off their loan.

  • Subprime and Preditory Lending are the same

    Subprime lending and predatory lending are essentially the same thing. While subprime lending could be seen as a "second change" act of kindness on the behalf of banks, it still preys on the financially week. Predatory lending is subprime lending, but will malicious intention. Both involve taking advantage of the financially weak, while knowing that the chance of being paid back is slim to none.

  • They are pretty much the same.

    Sub prime lending and predatory lending are the same in that sub prime lending is a form of predatory lending. Predatory lending does not have to be sub prime. It can actually be below sub prime and the worst of lending forms, while sub prime can be just above the worst, but they are basically the same.

  • They are not necessarily the same thing

    A lot of the predatory lending practices that contributed to the recession were based on subprime loans. However, subprime lending is not necessarily a predatory lending scheme. The key is whether the loan is fully explained to and understood by the borrowers, so that they can evaluate whether the loan is in their best interests. In addition, the lender must collect full financial information from the borrower to make sure that the loan is a valid business decision.

  • They are not the same thing.

    That's sort of like asking if a bullet and a bank robber are the same thing. Subprime loans are loans offered to people who are higher credit risks. They have higher fees and regular payments involved. Many banks offer these loans in an up front, ethical manner. Predatory lending often utilizes subprime loans, but does so in a manner that fails to disclose the risk and costs involved to the participant.

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