It’s not rocket science to work out the consequences - plunging house prices and then more and more find that their debts greatly outweigh their assets.
What these banks were buying was junk. If you buy junk you eventually run out of cash and just like the householders you're in trouble. In banking terminology, they’re over exposed. To the rest of us they're in a mess. So there you have it - the banking crisis in a nutshell.