Alt-A Loans

Alt-A loans are a type of mortgage made to borrowers who fall between prime and subprime categories. These borrowers typically have good credit but may have higher debt levels, less documentation, or unpredictable income verification. Alt-A loans often featured relaxed lending standards, making them accessible to more borrowers, but they also carried higher risks for lenders. These loans gained popularity before the 2008 financial crisis and are less common today, as lenders now emphasize stricter qualification criteria to manage risk more effectively.