The Wall Street Journal has an article about how lenders, to earn crazy high commissions during the boom, steered people towards sub-prime loans even if they could qualify for a conventional loan.
There was a lot of that and it was despicable.
However, some borrowers chose sub-prime loans of their own accord, for example, because they wanted a no-doc loan so they could lie about their income and get a larger loan, or because they were investors/speculators who wanted a zero down, interest only loan.
Don’t miss the cool interactive mortgage rate sheet in the article. It’s a little glimpse into the (boring) life of your lender.