Final answer:
The involvement of government-sponsored enterprises, Fannie Mae and Freddie Mac, began changing the home mortgage landscape in 1970 by securitizing and trading mortgage loans as financial assets.
Step-by-step explanation:
The landscape of home mortgage loans began to change significantly in 1970 with the involvement of two major government-sponsored enterprises (GSEs), which are Fannie Mae and Freddie Mac. These GSEs started purchasing large quantities of mortgage loans from originators and bundling them into pools that could then be traded as financial assets. This process of creating mortgage-backed securities allowed lenders to off-load the risks associated with the mortgages to investors. However, the separation of lenders from the financial consequences of borrower default, and the ratings agencies' lenient assessment of these securities, ultimately contributed to the financial crisis of 2007-2008 when the housing market collapsed.