Big homebuilders like D.R. Horton and Lennar are quietly building a new version of the 2008 mortgage trap, and this time regular banks aren't even involved.

• Home prices have way outpaced wages, so builders now act as the builder, the mortgage lender, and the insurer all at once, approving buyers that regular banks would reject.
• They hook buyers with "buydowns" that fake-lower the mortgage payment for the first couple years, then let it jump to the full, much higher rate.
• A huge chunk of these loans from 2022–2024 are now underwater, meaning people owe more than their homes are worth, with Lennar's numbers looking especially bad.
• The average homeowner is now spending over half their income on housing, while renters are increasingly coming out ahead financially.
• Lennar is also facing complaints about shoddy construction and reportedly pushing NDAs on homeowners who get repairs done.

Outlook: If these loans start failing en masse, builders could get stuck holding unsellable homes, especially since younger buyers are increasingly opting to rent instead of chasing homeownership.