If you think that isn’t a gamble, learning some history is in order. Real estate markets can go down, often in highly correlated events – for example, in San Diego in the 90s prices fell and stayed down for years because Cold War defense contractors laid off a ton of people & nobody needed a nice house near a closed plant. The market in San Diego did recover eventually but a bank would have to be prepared to maintain that property & pay taxes for years before selling it at a profit.

During the subprime crisis, the entire US market went down by 30% and in some places sales basically halted for months. Many thousands of people lost homes, and almost all of them had equity on paper before the bubble popped.

Individual actions also matter. Maybe the reason you can’t pay your bank is because you developed a mental illness or drug problem, and they now need to replace a large amount of damage before anyone will pay what you paid.

Those aren’t constant high risks but they are why smart bankers calculate the odds and plan for what they’ll do when something inevitably goes wrong.