 TITLE: What Does Subprime Mean? CONTENT: Types of Subprime Credit and Loans\n----------------------------------\nMany lenders have loans and credit card products geared toward subprime borrowers, and some lenders even specialize in subprime lending, although very few advertise themselves as such. If you think your credit falls into subprime territory, it may be hard to know which loans and credit cards you may qualify for until you apply.\nOne good place to start is the bank or credit union you use for your everyday finances.\nAlternatively, if you've received any offer or preapproval letters in the mail for the type of credit you need, consider those as well; chances are good they've used your credit score to target you and have a good idea of your credit standing already.\nOther borrowing opportunities subprime borrowers should consider include:\n*   **Government-backed mortgage programs**:\n*   FHA loans. Low interest mortgages backed by the Federal Housing Authority (FHA) are available with a 3.5% down payment to borrowers with credit scores of 580 or higher, and to borrowers with scores as low as 500 who can make a 10% down payment.\n*   USDA loans. U.S. Department of Agriculture (USDA) loans are available with a minimum credit score of 640 to borrowers who meet income guidelines and are buying homes in rural areas.\n*   **Subprime auto loans**:\n*   The financing officers at most car dealerships work with a variety of lenders, including subprime auto lenders. Depending on your credit score and income, they may offer a lower loan amount than a conventional lender might, and at a higher interest rate, but they may be able to help you get behind the wheel.\n*   If you don't have any luck at a traditional dealership, consider as a last resort shopping at a buy-here-pay-here dealer that offers direct financing.\n*   **Secured credit cards**: If you've been unsuccessful in applying for a credit card, consider getting a secured credit card as an interim option. With a secured credit card, you provide the lender with a sum of cash as collateral, and that amount becomes the borrowing limit on your card. You use the card as you would any other credit card, and as long as you maintain as low a balance as possible, and make your payments on time every month, your credit score will tend to improve so that after a year or so, you may be able to upgrade to a standard, unsecured, credit card. END