The Rise and Fall of the Mortgage Market

The old system when a homeowner paid their mortgage every month the money went to their local lender and since mortgages took decades to repay lenders were careful in the new system lenders sold the mortgages to investment banks. Lenders didn't care anymore about whether a borrower could repay so they started making riskier loans between 2000 and 2003 the number of mortgage loans made each year nearly quadrupled everybody in this securitization food chain from the very beginning until the end living cared for by people who had no liability if ratings proved wrong you weren't going to be on the hook.