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Are Subprime Mortgages Still a Part of Mutual Funds?

As such, you would think these types of dodgy loans would be a thing of the past. Although they come with a different name and appearance, the subprime mortgage is back with a vengeance and they are more popular than ever. They’re essentially housing loans given to people who don’t have the credit to qualify for a mortgage. Prior to 2008, they were given out to millions of people with no credit who were clearly unable to ever pay them back. The result was a huge debt bubble that eventually popped, causing the financial crash. Why They’re Back In the wake of the crash, tough legislation was brought in to stop predatory lenders from issuing subprime mortgages. These are proving to be just as popular as the subprime mortgages of the past, meaning there could be potentially devastating repercussions for the economy. What Investors Should Know If you’re an investor, especially one with their toes in mutual funds, this will obviously concern you. Make sure to keep up to date with all of the latest investment trends via money market investments, so you can avoid being burned in the future. One thing that’s certain is that if another major banking collapse does happen, the political will to bail them out like in ’08 will be non-existent.