Subtitles in iMovie

In the most recent version of iMovie you should use the "Lower" from the titles selection, and then make sure to either centre the text or select no alignment, and probably add an outline to it (the "O" next to bold & Italics). If you use a font size around 58 you should be able to get several lines of text, without taking over too much of the screen.

iMovie Titles force you to make large readable titles and stay in the title safe area. There is no iMovie Title that is optimal for subtitles, although you can use a lower third title at a reduced font size and get close.

Another way would be to use Apple's Keynote App (available for about $20 from Apple https://itunes.apple.com/us/app/keynote/id409183694?mt=12 )

With Keynote, you can create a green screen background in 1920x1080 dimensions and place your title exactly where you want it and in the font and size and color you want. Then Export it as a QuickTime movie with Timed Advance, and then use it in iMovie as a Greenscreen Clip.

Here is a sample of Keynote through green screen ( but it is a bullet example rather than a subtitle.) Note that you can do many complex transition effects in Keynote such as typing one word at a time, or one letter at a time.

I should probably also mention that if you purchase Final Cut Pro X, there are subtitle plugins available for purchase that enable you to easily make professional quality subtitles. This is a big investment over the cost of iMovie, but I thought I would mention that as well.