Subprime mortgages
Home loans made to those with poor credit ratings. In the 2000s, some of these borrowers were dubbed “ninjas” as they had no income, job or assets. The loans were then bundled together as part of the securitisation process and sold to institutional investors and shadow banks. When house prices started to fall, many subprime borrowers defaulted, contributing to the 2007-09 financial crisis.
