Alt-A

Definition:

Short for Alternative-A paper. Alt-A are loans that are considered riskier than prime loans but less risky than subprime loans. Generally made to individuals with a good credit score but some aspect of the loan (e.g. limited documentation or high loan-to-value ratio) makes the loan riskier than prime. Also see A paper, No docs.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Pooling of interests

An accounting method for reporting acquisitions accomplished through the use of equity. The combined assets of the merged entity are consolidated using book value, as opposed to the purchase method... Read More

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