“Borrowing from the bank container”: A phrase employed by loan providers to spell it out guidelines on acceptable borrowing from the bank exposure one to takes on. From the leadup for the economic crisis, lenders ordered excessive degrees of fund from individuals which have reasonable credit ratings just like the lenders experienced they had the newest complex modeling you to definitely you will definitely counterbalance much of it borrowing from the bank risk because of solution routes, such as for example credit insurance rates and over-collateralization). ”. Come across Honest Nothaft interviews.

Credit enhancement: A solution to counterbalance exposure, instance as a consequence of insurance elements, provision out of even more security, improves their borrowing structuring therefore it can also be receive way more good regards to fee getting mortgages. Continue reading However, this approach turned into a dramatic expansion of the “credit field →