I took out a mortgage and bought a condo in my single days. I had a good job and good credit and put down a sizeable down payment. I got the condo, lived in it for several years until I joined the Foreign Service, then sold it.

I thought everyone bought homes this way. They saved money for a down payment, worked up a good credit record, then chose a house that suited their income. Bankers wouldn’t lend money on a house that the buyer couldn’t afford, I thought.

Several years later, after my mother died, my brother and I sold her home. The buyer sold a smaller house to buy hers. That fitted into what I understood was one way to buy a house—to build up equity in a smaller one, then sell it.

However, the buyer of her house bought it with a 100 percent mortgage, no money down. It was the first time I knew of someone buying a home without the requirement to pay a portion of the price as a down payment.

Not long after that, the housing bubble burst. Lots of people, it seemed, had underwater mortgages. They owed more on their houses than they were worth.

The drop in house prices was a major reason, of course, but some of it could be traced to the owners not being required to invest more in their houses before they bought them.

So why did the lenders not require home buyers to make sufficient down payments?

Lots of mortgages, it seems, were packaged together. Some included mortgages which shouldn’t have been made under the old rules, but, supposedly, other mortgages to able buyers would balance them out. Lenders would make more income than ever from lending more money, even to unqualified buyers.

So it was okay to set up a home buyer for failure. It was okay to lend to folks that lenders knew weren’t going to be able to continue in their homes, who would fail. It was okay to do this because it would work out, for the lenders, at least.

Only it didn’t, and thousands of homeowners suffered. People who were conned into thinking they’d finally reached their dream of home ownership dropped into a nightmare.