Prime vs Sub Prime - clarification

[cp94550]

Can someone explain to me he difference between prime and sub prime? Like what specifically makes something one or other? Is the QS1 considered sub, while the Venture prime? Does it come down to CL, AP rate?

[Anonymous]

It's not the credit card issuer or credit card that is prime or sub prime, it's the borrower (card user) that is classified as prime or sub prime. A prime borrower is someone who is considered not risky by lender, and is usually provided with low cost credit cards or loan (low APR, high CL).

Issuer that primarily caters to subprime customer (like Credit One or First Primier) are sometimes called subprime lender. That's about it.

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@cp94550 wrote:
Can someone explain to me he difference between prime and sub prime? Like what specifically makes something one or other? Is the QS1 considered sub, while the Venture prime? Does it come down to CL, AP rate?

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[Anonymous]

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@Anonymous wrote:

It's not the credit card issuer or credit card that is prime or sub prime, it's the borrower (card user) that is classified as prime or sub prime. A prime borrower is someone who is considered not risky by lender, and is usually provided with low cost credit cards or loan (low APR, high CL).

Issuer that primarily caters to subprime customer (like Credit One or First Primier) are sometimes called subprime lender. That's about it.

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@cp94550 wrote:
Can someone explain to me he difference between prime and sub prime? Like what specifically makes something one or other? Is the QS1 considered sub, while the Venture prime? Does it come down to CL, AP rate?

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I don't know for sure, but someone I know put it this way:

500 SL = Sub Prime

3000 SL Mid Prime

5000 SL and up - Prime

[takeshi74]

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@cp94550 wrote:
Can someone explain to me he difference between prime and sub prime? Like what specifically makes something one or other? Is the QS1 considered sub, while the Venture prime? Does it come down to CL, AP rate?

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As stated above, subprime and prime are really only relevant to the borrower and not the card despite how people tend to use the terms.  A given creditor or product may cater to prime or subprime consumers.  As for popular usage, it's subjective and doesn't really mean much.

Don't worry over what others consider "prime" or "subprime".  Start with sorting out your specific needs/wants.  Use that to select cards that suit you.

CL's and APR's are not just determined by the product.  It's what one's credit profile and income qualify for that determine these things.  if one has poor/thin credit and applies for a "prime" card one can get a low CL and a high APR.  Another person with excellent credit and a thick profile could get a high limit and low APR applying for the same card.  Again, it's a matter of the individual.

Don't overlook prior discussions as a resource as well.  This is an extremely common topic.

https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&es_th=1&ie=UTF-8#q=prime%20subprim...

[Anonymous]

While 'prime' and 'subprime' have to do with the borrower more than the issuer, here's a little clarification regarding your question specifically about Cap One cards.

All of this is ONLY for Cap One.

Capital One is an issuer that has products available for prime profiles as well as subprime profiles. The quickest way to tell, from a standpoint of someone who does not currently carry one of those cards, is to see what type of card it is.

For Cap One, MasterCards are likely available to people with subprime profiles. This includes the Builder Program card (if you can still get that), the secured offer, the platinum offer and the QS1. Visas, on the other hand, are prime offerings - VentureOne, Venture and QS. The exception to this is the Journey, which is their student card so it has less strict underwriting than their other visas.

If you're not sure, check in the terms and conditions of the offer. Capital One's terms will pretty much tell you. If it says you can't apply for the card if you have two capital one cards already, it's catered toward subprime borrowers. If it says the offer doesn't apply if you have five capital one cards, it's catered toward prime borrowers. I've found this in terms for cobranded cards as well (Sony and the PlayStation cards) so it's a decent hint across the board.

[Anonymous]

Prime is interest below 20% or so and limits greater than id say around 3k. (Chase, AMEX, Citi) [All of which are no better than Cap1 or NFCU in regards to CC function]

Sub-prime is +20% interest rate, below 3k limits and annuall fee, activation fee etc etc etc. (Blaze, Verve, Milestone)[Rebuild cards for a year when no one will approve you]

[longtimelurker]

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@Anonymous wrote:

Prime is interest below 20% or so and limits greater than id say around 3k. (Chase, AMEX, Citi) [All of which are no better than Cap1 or NFCU in regards to CC function]

Sub-prime is +20% interest rate, below 3k limits and annuall fee, activation fee etc etc etc. (Blaze, Verve, Milestone)[Rebuild cards for a year when no one will approve you]

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But these are all fairly arbitrary reflecting the fact that the term, as applied to ccs rather than borrowers, has little meaning.    That said, to me one pretty firm rule:  if the card has a MONTHLY fee, it's probably subprime!

[longtimelurker]

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@Anonymous wrote:
While 'prime' and 'subprime' have to do with the borrower more than the issuer, here's a little clarification regarding your question specifically about Cap One cards.

All of this is ONLY for Cap One.

Capital One is an issuer that has products available for prime profiles as well as subprime profiles. The quickest way to tell, from a standpoint of someone who does not currently carry one of those cards, is to see what type of card it is.

For Cap One, MasterCards are likely available to people with subprime profiles. This includes the Builder Program card (if you can still get that), the secured offer, the platinum offer and the QS1. Visas, on the other hand, are prime offerings - VentureOne, Venture and QS. The exception to this is the Journey, which is their student card so it has less strict underwriting than their other visas.

If you're not sure, check in the terms and conditions of the offer. Capital One's terms will pretty much tell you. If it says you can't apply for the card if you have two capital one cards already, it's catered toward subprime borrowers. If it says the offer doesn't apply if you have five capital one cards, it's catered toward prime borrowers. I've found this in terms for cobranded cards as well (Sony and the PlayStation cards) so it's a decent hint across the board.

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Or even more easily, for current offerings, check which credit level each card requires on Cap One site.     QS requires "Excellent" while QS1 is "Average"   (and Cap One's definition of "Excellent" is very lenient)

[Anonymous]

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@longtimelurker wrote:

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@Anonymous wrote:

Prime is interest below 20% or so and limits greater than id say around 3k. (Chase, AMEX, Citi) [All of which are no better than Cap1 or NFCU in regards to CC function]

Sub-prime is +20% interest rate, below 3k limits and annuall fee, activation fee etc etc etc. (Blaze, Verve, Milestone)[Rebuild cards for a year when no one will approve you]

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But these are all fairly arbitrary reflecting the fact that the term, as applied to ccs rather than borrowers, has little meaning.    That said, to me one pretty firm rule:  if the card has a MONTHLY fee, it's probably subprime!

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Most individuals will relate more easily to the obtainable credit in a given category rather the specific factors that equate a prime or sub-prime borrower, this is the reason most people relate the terms to products. Traditionally prime begins at 680+ sub-prime ends at around 650-660. However other factors depending on the UW will factor into the person ability to acquire credit.

[azguy13]

I agree with much of what people are stating here except for the $3k> means subprime. An applicant can have a score in the 700s but have a low income and may not be issued a $3k limit. By that logic, someone who makes $20k/yr with a 730 FICO and $15k (representing 75% of their annual income in credit) in available credit would be considered subprime; which really isn't true.