A lender might also originate a loan to a borrower without the cash flow to make the monthly payments and then immediately sell the loan to a secondary market investor. This locks in a profit for the original lender regardless of the possibility of the borrowers default. These loans are aggregated and become mortgage-backed securities. The investor in these securities has a less-than-expected yield from them when the borrower defaults.
Sadly, in many cases where a person with large credit card debt (i.e. unsecured), no assets beyond the equity in their home, and no cash flow to cover the minimum monthly payments, a better option for them may be to work out a payment plan with the credit card companies covered by the cash flow they do have, or even to declare bankruptcy so that they do not lose their home in a foreclosure sale.
Another far more complex, very innovative (but allegedly criminal) predatory tactic involves predators creating and exploiting conflicts of interest among the various purchasers and servicers of a pool of mortgages, through frivolous foreclosures of performing loans, and legal barratry contrary to fiduciary duty that are extremely profitable for the predators.
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