1. Subprime mortgage lending: Many banks and financial institutions were issuing mortgages to borrowers with poor credit history or low income, leading to a housing bubble. When the bubble burst and the housing market collapsed, it had a ripple effect on the rest of the economy.

2. Securitization of mortgages: Mortgage lenders bundled their loans together and sold them as mortgage-backed securities (MBS) to other investors. This practice spread the risk of default across the financial sector. However, when borrowers started to default on their mortgages, the value of these securities plummeted, causing widespread losses for investors.

3. Irresponsible lending practices: Lenders were offering mortgages with low interest rates and lax lending standards, such as adjustable-rate mortgages (ARM) or no-documentation loans. When interest rates rose and borrowers were unable to afford the higher payments, defaults and foreclosures increased, contributing to the crisis.

4. Excessive risk-taking by financial institutions: Some banks and financial institutions engaged in risky practices, such as investing heavily in mortgage-backed securities and complex derivatives, without adequately assessing the potential risks. When the housing market collapsed, these institutions suffered significant losses and some even faced insolvency.

5. Lack of regulatory oversight: Regulatory agencies and governments failed to effectively regulate the financial sector and prevent risky behavior. There was a lack of transparency and accountability, leading to the accumulation of systemic risks.

6. Global interconnectedness: The crisis rapidly spread across borders due to the interconnectedness of the global financial system. Financial institutions around the world held toxic assets and were intertwined through complex financial instruments, exacerbating the impact of the crisis.

Overall, the combination of these factors led to a severe credit crunch, a collapse in consumer spending and investment, and a deep recession in many countries. The crisis served as a wake-up call for policymakers and regulators to reassess their approach to risk management and strengthen oversight of the financial sector.