Housing Crisis and "Toxic Assets"

From April 16, 2009:

To Congress,

This recession started with the housing crisis. Banks were faltering under the burden of a massive number of loans that could not be repaid. These "toxic assets" threatened our entire financial system. Why would banks approve loans, which they had to know, could not be repaid? They did this because they were required to approve these loans by the federal government.

Starting with the Community Reinvestment Act of 1977 , and extended by such bills as the Federal Housing Enterprises Financial Security and Soundness Act of 1992, banks were required by law to grant these unsound loans. By 2001, over 50% of home mortgages had to meet the requirements set in these acts. How did anyone expect banks to survive, much less prosper, under these conditions? My question is why aren't these acts being repealed? If we want our financial institutions to be sound, why are we forcing them to operate using unsound business practices?

Signed,
The Electorate