The subprime mortgage crisis was a financial disaster that occurred in the late 2000s, primarily in the United States. It involved the widespread issuance of high-risk loans, known as subprime mortgages, to borrowers with poor credit histories. When housing prices began to fall, many of these borrowers defaulted on their loans, leading to a surge in foreclosures. As defaults increased, financial institutions faced significant losses, which contributed to a broader economic downturn. The crisis revealed weaknesses in the banking system and led to the collapse of major firms, prompting government intervention and the implementation of new regulations to prevent a similar situation in the future.