Reckless expansionduringthe housingboomsaddleditwithmore than $50 billion in optionadjustable-rate mortgages, amongthe mostlikely to explode whenmarkets turned.
It cannot just be assumed that most people who during the housing boom bought homes with adjustable-rate mortgages, or mortgages with prepayment penalties, or mortgages that required a low or even no down payment, were fools or victims of fraud.
The credit boom was created by initially low adjustable rate mortgages, interest-only or negative amortization loans, and an appreciating real estate market that allowed homeowners to extract equity to help make mortgage payments.