A government program created during the Jimmy Carter administration designed to make it easier for lower income folks in primarily inner city neighborhoods to get mortgages they otherwise wouldn't qualify for was put on steroids during the Clinton administration. 

Led by greedy politicians looking to buy votes, (overwhelmingly liberal democrats) used the threat of government backdoor force, the threat of protests by liberal left-wing community groups, the incentive of kickbacks and bonuses, and (wink-wink) less regulation, banks disregarded their regular rules and vetting processes, including red lining certain areas, used to determine lending risk to the banks, as well as normal debit to income ratios and employment information used to determine who was actually qualified to take on a mortgage, and simply gave mortages to just about everybody...even folks without sources of income.  This was, of course, fair lest we be accused of denying their "right" to the American dream of owning their own home.

Reality check...owning a home is not a right, it is a privilege which is earned.  Rights are individual and do not/cannot by definition impose upon the rights of others.

The lending banks quickly sold these worthless mortages to the government as insurers under Fannie Mae and Freddie Mac while both the banks and Fannie and Freddie cooked their books to show hugely inflated assets on paper from all these crappy mortgages which triggered massive bonuses to those placed at the top via Clinton administration cronyism...not to mention hefty payments to politicians who happened to sit on banking committees.  You know, the folks who were supposed to be keeping an eye on things, but instead (wink-wink) looked the other way.

Calls to look deeper at this practice and closer at Fannie and Freddie's books were dismissed in recent years by those in control of both houses of congress (liberal democrats) claiming all was sunshine and lolipops with Fannie and Freddie.  (Many folks then invested in Fannie and Freddie based on their claims and have since lost everything.)

Then the bubble burst.  The lousy mortgages came home to roost as defaults (go figure) and foreclosures and the huge stable assets of these banking institutions were shown to be huge steaming piles of poop in reality.

Those in control of both houses of congress moved faster than they ever have before to shove a spending / bailout bill down our throats using urgency as a diversion from the reality of what really happened.  (They didn't move that fast after 9/11.)  Said bailout was bloated with so much pork and many dangerous and likely unconstitutional provisions that, in addition to it being the largest private property grab by the federal government in history (that should scare the crap out of you), it didn't rescue the market, it tanked it and left more and more unanswered questions all while keeping the generally ignorant public in the dark about what really happened, who was really responsible, and what the "bail out" really means. 

Now, folks who never should have been given mortages, folks who would never qualify for mortgages, folks who lied on applications, folks who signed the papers...fine print and everything...are able to petition the court with whining and the courts are able to tell the banks to adjust mortgages to better suit the individual situation of each borrower...even lowering the principal!!

So, to further buy votes from the deadbeats and call it fairness, those who default on their mortgages get a handout fix so they "don't lose their homes."  Nice, huh?

Try that with your mortgage or car payment and see how fast you are out on your ass and your car repo'd.  Try that with your cell phone bill and see how fast your service is shut off.  You're responsible.  You'd expect that when you break the contract you knowingly and willingly signed in good faith with full disclosure.  Maybe you've been denied a good rate on a loan because your debt to income was too high.  Maybe you busted your ass to pay off some debt so you could get that better rate or afford that new car or house and play by the rules.

Now, who pays the difference in this government created mess?  Who pays the tab when "certain" people default on loans and are actually rewarded for it?  Who freakin' pays??  That's right, baby.  Pass the K-Y.