Credit Quality Terms
Prime Loan – A conventional single-family mortgage made to a borrower with strong credit. Also known as an A loan.
A- (A-Minus) Loan – A conventional single-family mortgage made to a borrower with slightly impaired credit.
Alternative-A (Alt-A) Loan - A conventional single-family mortgage made to a borrower who typically provides limited income or asset verification or no evidence of an employer. Such loans may have other non-standard underwriting.
Subprime Loan - A conventional single-family mortgage made to a borrower with impaired credit.
Loan Type/Size
Conventional Mortgage – A loan that is neither insured nor guaranteed by the federal government (such as by the Federal Housing Administration or the Department of Veterans Affairs).
Conforming Loan – A conventional single-family mortgage with a principal balance eligible for purchase by Fannie Mae and Freddie Mac (in 2007 that limit is $417,000) and that otherwise meets the credit quality standards of the Enterprises.
Jumbo or Non-Conforming Loan – A conventional single-family mortgage with a principal balance exceeding the conforming loan limit (in 2007 that limit is $417,000).
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