They didn't find "clever ways to issue mortgages to unqualified borrowers". Simply put the US government guaranteed all the mortgages via Fannie Mae and Freddie

They didn't find "clever ways to issue mortgages to unqualified borrowers". Simply put the US government guaranteed all the mortgages via Fannie Mae and Freddie Mac by law. The law passed by Congress in 1990s to increase number of homeowners among minorities was to guarantee all the bad loans by the Government. So from a banker perspective it didn't matter if a borrower will repay. Because if he doesn't than the tax payer will by the law. So, ultimately, it's government fault. And democracy fallacy that voters vote for idiotisms like this and then complain that "banks are greedy".