Sub-prime borrowers were largely middle-class people refinancing survival costs, not stereotypical poor fraudsters.

Evidence

At the other end of the spectrum from our high-flying financier, we find another icon of financialized precariousness: the sub-prime borrower. As discussed above, while decried as so-called “NINJAs” (No income, No Job or Assets), the sub-prime category was amorphous and stretched far beyond the stereotypical image that became associated with it: that of a poor, black urban welfare recipient who greedily took advantage of easy money to make frivolous purchases (McNally 2011, 119–126; Wyly 2010). … The result was that sub-prime borrowers ranged from the truly destitute, through the working poor, into the middle class (McNally 2011, 97–107; Taibbi 2010, 78–123). These borrowers took out loans not only to buy homes but to repair houses, to pay for education, to make renovations, to pay medical bills and, importantly, to pay off prior debt, much of it incurred simply by the costs of trying to live in precarious times on a meagre and unstable income. At their height, many sub-prime “securities” were made up of loans that had been refi- nanced two or more times, each with its own exploitative conditions (Wyly 2010). — Max Haiven, Cultures of Financialization, 194

Categorization

• XREF: Connects to the broader critique of financialized everyday life that is the book’s core argument, and to the popular mythologizing of ‘NINJA’ loans vs. their actual demographic reality. — connects to: Financialized risk-taking is concentrated in the upper middle class, not spread across all earners — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 143; Financial risk-taking emerges in middle classes as a response to top-end inequality. — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 3; Financialization of households is stratified by class, not uniform — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 21 (+1 more)
• SHARE: Good corrective to share with anyone who repeats the stereotype that sub-prime borrowers were greedy poor urban welfare recipients gaming the system.

Broader Connections

• Financialization of households is stratified by class, not uniform #corroborates (0.88) — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 21
• Financialized risk-taking is concentrated in the upper middle class, not spread across all earners #corroborates (0.85) — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 143
• Financial risk-taking emerges in middle classes as a response to top-end inequality. #corroborates (0.82) — Neil Fligstein & Adam Goldstein, The Emergence of a Finance Culture in…, 3
• Blaming borrowers’ financial ignorance obscures the structural logic of sub-prime lending #corroborates (0.78) — Max Haiven, Cultures of Financialization, 528