A bond that is guaranteed by a monoline. A wrapped bond has the same credit rating as the insuring monoline which is generally higher than the credit rating of the bond issuer. As a result of the guarantee and higher credit rating, the issuer can obtain financing at a lower interest rate than it may have otherwise received. Wrapped bonds were originally used in municipal bond issuances but now are used to reduce the borrowing costs associated with a wide variety of financial products including project finance bonds and mortgage-backed securities. Following the 2007 subprime mortgage crisis and the increased number of mortgage defaults, several monolines who insured these bonds were downgraded, resulting in reduced usage of wrapped bonds.