What is a subprime mortgage?
A subprime mortgage is a loan which is marketed to people who would not qualify for a regular mortgage because of a low credit score. Subprime mortgage holders are more likely to not be able to pay the loan back, and so are a higher risk for the bank to take on. This means the mortgage loan given to the subprime borrower will have a higher interest rate, and is usually an adjustable rate mortgage.
Even with a higher interest rate, though, the monthly payments of these loans can be arranged so that they are lower than a standard mortgage of the same amount. This is usually done by allowing the borrower to pay the interest only for the first term of the loan, and then have the payments go up considerably at some point. Unfortunately, this is a tactic used by predatory lenders who try to trick the borrower into thinking that they can afford a loan when they really can't. You should never accept a mortgage amount that is more than you can comfortably afford.
It is common today for people to live beyond their means. 43% of Americans spend more than they earn, and 52% of them live paycheck to paycheck. Granted, some of these people are only living with the basic necessities and still cannot earn enough to cover expenses. However, a large percentage (61%) of subprime borrowers in 2006 had credit scores high enough to qualify for regular mortgages. They were simply lured in by the idea of a more expensive house because the monthly payments were initially so low. The rampant materialism of Americans and the desire to have what you can't afford needs to be changed, because it is unsustainable, and can only result in mass debt and bankruptcy.