Whether the bank can get its money back and whether you can pay for the mortgage are different things. It's not credit card debt, even if you go bankrupt the b

Whether the bank can get its money back and whether you can pay for the mortgage are different things. It's not credit card debt, even if you go bankrupt the bank can still collect the debt by evicting you. So it's not the same as loaning someone money for consumables. Banks price foreclosure and delinquency rates into their interest rates. In 2007/2008 this didn't work because the banks themselves were over-leveraged. But it doesn't change the fundamental aspect of this that a bank can be quite happy to give you a loan you don't have a high chance of paying back. If they charge you high enough interest rates it's free money for them.