Considering the recent housing bubble analysis, the example of subprime lending is Bradley is a first-time homebuyer who does not have enough money for the usual 20% required for a down payment. Nonetheless, a bank offers Bradley a loan because his income is sufficient and home prices have increased.
This is because subprime lending is a type of lending whereby the lender lends money to borrowers with low credit ratings.
Also, it should be noted that Above-average interest rates characterize subprime lending.
Given that Bradley can not afford the usual 20% required for a down payment, this shows he is a borrower with low credit ratings.
Hence, in this case, it is concluded that the correct answer is option A.
The available options are the following:
A. Bradley is a first-time homebuyer who does not enough money for the usual 20% required for a down payment. Nonetheless, a bank offers Bradley a loan because his income is sufficient and home prices have historically increased.
B. Jurgen wants to purchase a home and is hoping to minimize his monthly mortgage payments. The bank offers Jurgen an adjustable rate loan which has a lower initial rate but will potentially increase in the future.
C. Chris is a real estate tycoon. He owns many homes and apartment complexes. Because he owns so many properties, he is particularly vulnerable to fluctuations in the real estate market. His bank is willing to loan him more money despite this risk.
D. Vincenzo does not have sufficient income to afford the payments on the mortgage for which he is applying. However, Vincenzo\'s older and wealthier girl friend has agreed to co-sign the loan. The bank agrees to loan Vincenzo more than he can afford to repay because of existence of his co-signer.
Learn more about subprime lending here: https://brainly.com/question/17272210
