If they were variable rate mortgages, the interest rate increases with the rate set by the fed or LIBOR or some other standard. Many of the mortgages were taken out when interest rates were historically very low (sometime after Sept. 11). for example, on a 30 year mortgage with a $200,000 principal: a 3% interest rate has a $10,000 annual payment while 8% requires $17,000 payment annually. That is a significant difference, and what was affordable at a lower rate becomes difficult to pay at a higher rate. As someone else also mentioned, many persons who qualified for prime loans were given sub-prime loans anyways.
