Get someone to sign a mortgage when they can pay now but not in five years, but as the housing value goes ever upward, they'll just get a new one to pay off the old one, and you make easy money and they get easy value, and you probably even sell then the next mortgage. That's where the bubble came from, just like the 1929 crash, only then it was inflated stock, and nothing was left behind except bad paper. In this case, banks are under the delusion that they'll ever get something resembling adequate value out of the foreclosed houses. That money was spent over the course of years in fees to mortgage services, to salaries and dividends and bonuses to bankers, even to the homeowners who reaped the benefits of credit lines, decreased housing costs, and so on. The money's gone, the houses remain, worth far less than the mortgage paper says they are, and nothing brings that back.
Most of it was not precisely criminal, but it could not have been a stupider scheme if drawn up by Dumb and Dumber. Blaming Maxine Waters is a great idea--she should have known better than to do anything to help bankers make money. She was looking for a way for more people to get into owned housing, and the bankers apparently cried all the way to their own banks. The simplest possible point, every time regulation of banks and other large financial institutions is minimized, the inevitable end result is economic chaos. Blame whoever you like for this mess, but the former homeowners are out on their ears, thousands have lost jobs, and the bankers are still floating in money--only now it's government money. Good thing they ain't at fault at all, because otherwise it just looks unseemly.
"Don't take your life too seriously, son. At the end of it, you won't be alive anyway."