Home prices in this country are as high as they've ever been and still they are selling at the fastest pace on record.
One reason is it's easier than ever to get a mortgage. But, as CBS News Correspondent Trish Regan reports, many people are getting mortgages that they really can't afford.
Cathy Zimmer, 25, of New York, just applied for her first home loan. She says she was surprised by the different kinds of mortgages available.
"I was overwhelmed actually," Zimmer said.
Mortgage broker Eric Abbelbaum says that the options run the gamut.
"You have your traditional 30 and 15 year fixed, you have your long term ARMs, 10 year, 7 year, 5 year," he said.
And that's just the beginning of the list, according to Abbelbaum. He says you can even get a loan without letting the bank know how much money you make.
"Banks have lowered their credit standards and offered products where the monthly payments are lower so it's easier for you to afford more," he said.
Consider this: Ten years ago, if you made $45,000, lenders would probably approve a $160,000 mortgage. Today, that same income will get you $280,000.
But Regan reports that today's housing market is nothing like it was a decade ago, because sales are soaring, pushing prices higher and higher. It's created a win-win situation for lenders to be creative and keep the money flowing.
Mark Agah says lenders have an incentive to keep real estate prices high.
"They have an incentive to keep volume humming along and they have the incentive to keep lending to the consumer so they can keep inflating the home price," Ahag said.
Lenders can even cash in if the borrower defaults.
"When the banks are having to foreclose on loans nowadays, they're actually making money when they flip the house," Ahag said.
But Doug Duncan of the Mortgage Bankers Association insists that banks consider the financial health of their customers.
"Banks absolutely care whether the borrower will pay the loan back or not," said Duncan. "Banks have regulators and they have stock holders and their incentives are to practice sound lending practices."
However, Federal Reserve Chief Alan Greenspan believes that next to rising energy prices, these potentially risky loans are the biggest threat to the economy.
So, buyers like Cathy Zimmer are smart to be cautious.
"It's a scary thing to think about the hundreds of thousands of dollars you're taking out in debt," Zimmer said.
Especially when it's you that's gambling on the housing market — not your lender.