In the beginning, for one to qualify and be issued with a loan, full documentation was needed, but as time went by, a few documents were required, and later no documents were needed. Subprime loans also gained popularity among borrowers, especially mortgage products. The mortgage product was acceptable to even for jobless people, had no income or no assets. This saw many companies being reluctant to follow the required underwriting practices, and by 2006, about 60% of all the mortgages bought from at least 1,600 mortgage companies were considered defective (Hanan & St. Onge, 2018). This means that they did not follow all the underwriting policy documents, and the figure for defective mortgages increased in 2007 to 80%.
