Legislating Good Sense?

There is an old expression that says you cannot legislate morality. To that I have always added that you also cannot legislate good sense. Well, I guess I have been wrong all this time.

Legislation is now pending in the US Senate that would mandate mortgage lenders to consider the ability of the borrower to repay the loan! Similar legislation, I understand, is pending in Oregon and other states. Back in December the Federal Reserve found it necessary to issue a 'rule' that banks had to have proof of the borrowers income when granting a mortgage.

All of this frankly boggles my mind. How did we arrive at a point where it is necessary to mandate banks to use good sense. Or, how did this chief credit officer;

Get replaced by this one?