During a recent financial workshop, I met a single mother who couldn’t afford her mortgage.

We talked about her options, which included selling her two-bedroom townhouse and moving into an affordable apartment or getting a roommate. But while speaking with her, I had to suppress my anger.

I was angry with the lender that approved her interest-only loan. It’s true that the young woman should have realized that once her mortgage was adjusted to include principal, her monthly payment would crush her budget.

But having worked with so many homeowners in her predicament, I understand that the desire to have a home overrode the financial sense she needed to realize that in the long term, the mortgage would be too much to handle.

However, the lender deserves disdain. All the folks involved in selling and approving her loan should have known she wasn’t ready to be a homeowner. Traditional and more prudent underwriting standards would have shown that she could not handle that mortgage.

It is this young woman I think about as I look at the regulatory efforts to deal with the fallout from the housing crisis. One proposal under consideration is to implement loan underwriting standards to ensure that borrowers have a reasonable ability to repay their loans long term and not just during a teaser-rate period.

Another idea would require borrowers to come up with a 20 percent down payment. If they don’t meet this threshold, their loans would be considered more risky and would not meet the definition of a“qualified residential mortgage,” or QRM. People could still get loans, but if they didn’t have the 20 percent down, the bank would charge a higher interest rate.

Last spring there was much uproar from consumer advocates and the housing industry about the impact that higher down payments — either at 20 percent or even 10 percent — would have. A study released this month by the UNC Center for Community Capital and the Center for Responsible Lending shows such a rule could push creditworthy borrowers into higher-cost loans, and perhaps out of the housing market.

Researchers found that had the tougher down payment standard been applied, 60 percent of the borrowers would not have qualified for the best interest rates.

Research shows that down payments help reduce the chance of a foreclosure because borrowers have more to lose. But that’s just one predictor. The report also concluded that lenders can still make safe loans to borrowers who put less upfront if regulators restrict loans with features associated with higher default rates, such as the interest-only loan made to the single mother in my workshop or loans that lack adequate income documentation, or loans that allow“negative amortization,” which means that the unpaid interest is added to the mortgage balance. With negative amortization, you end up owing more on your mortgage than you originally borrowed.

”Clearly, the policy goal should be to encourage the origination of loans that are appropriately underwritten and that take into account a borrower’s ability to pay,” researchers said in the report.

The truth is, we do have to look at what regulations will help prevent another crash in the housing market. There is no question we have to eliminate the industry practices that allowed lenders to make risky loans. No one is suggesting people shouldn’t put something down, but what percentage this is should be flexible.

With better and non-predatory guidelines, lenders can make good loans by looking at people’s income, major expenses and debt-to-income ratios. Changes have to be made, but we shouldn’t block homeownership from creditworthy people because they don’t have a hefty down payment..