If nothing else, the recent settlement between 49 state attorneys general and five of the nation’s largest mortgage lenders has exposed many weaknesses in the current system of mortgage lending and foreclosures. However, it’s important that both consumers and the media refrain from jumping on the banks and blaming them exclusively. They certainly do own their fair share of the blame here, but we cannot leave out the responsibility of consumers and the federal government.

All three parties share culpability in the collapse of the housing market. Yet this reality is a strangely missing in most media reports, including a March 2 story from the Las Vegas Sun. The newspaper reported on the fact that foreclosure mediations in the Silver State involve banks attending without the legally required documentation almost 1/3 of the time. While that’s not good, it’s certainly an improvement over the 50% rate of previous years.

It’s completely understandable that banks would be called into question for not showing up to mediation with the legally required paperwork. In fact, if that’s the law then take them to task for it. But at the same time there should be some reasonable questioning as to why it occurs.

The truth, as was uncovered during a recent New Jersey Supreme Court case, is that the biggest problem with foreclosure paperwork is providing documentation about who actually owns a mortgage. In many cases the bank that comes to mediation is not the mortgage owner, it only services the loan. Tracking down who actually owns it is a very difficult task in light of the circumstances that created the housing bust to begin with. Furthermore, the federal government has played a very large role in this mess; a role that is rarely spoken about.

The truth of the matter is that mortgages were given to far too many homeowners who could not afford them based solely on rewritten regulations out of Washington that guaranteed such loans through Fannie Mae and Freddie Mac. Congress also rewrote banking regulations to allow banks to repackage risky mortgages and sell them as securities, a practice that used to be illegal. The result was tens of thousands of bad mortgages repackaged and resold so many times that, in many cases, it’s difficult to track down who actually owns them.

The New Jersey Supreme Court case settled last week takes this very thing into account. The court ruled that foreclosures can proceed, at least in New Jersey, even if the mortgage owner’s name and identity is not listed on foreclosure papers. As long as the loan servicer is properly represented foreclosures can proceed in that state.

It is fair to blame the banks for poor record-keeping and not fulfilling legal requirements. But it’s not wise to blame them entirely for the housing bust. At some point, consumers and the federal government must take responsibility for their actions or we are bound to repeat the same mistakes again in the future.