“If people had continued to have jobs, they would have been able to pay the mortgages.”
The point is many people didn’t have jobs that would have allowed them to buy a house or even if they did they didn’t pay their mortgage (& never planned on paying it). That is why they weren’t credit worthy to begin with!
I agree that is largely the root cause. But I think DannyTN is on to something too. There were many people on the bubble in terms of their ability to repay a mortgage. They took the usual solution by moving WAY out of town.
In our area it was surprising to hear about the boom towns so far our - 40 or 50 mile commutes.
Then, when oil prices spiked and the Demos would not allow President Bush to allow more drilling it became a choice of paying the mortgage or buying gas to get to work.
As I recall, that is what pushed the housing bubble over the edge and started the collapse.