Navigating Through The Gov’t Shutdown.

USCapitolA few days ago someone sent me a link to a diddy posted on  The post covers a lot of bases, some of which includes some big picture stuff. Other points include everyday real estate situations that REALTORS/lenders/buyers/sellers/closers are dealing with accordingly.

Here’s the thing. Many folks who think they’re pure free market capitalists damn the government all to heck, and wish most of government would just go away (so we can do some real business, right?). Well, when folks peel a few layers back they soon find out the government onion isn’t so bad.

For example, most everyday REALTORS have a buyer or two. Well, if one of those is a first time buyer, that buyer is likely taking advantage of a FHA backed loan which allows the borrower to bring (only) 3.5% down on a capped loan amount. How is this possible? Federal government. How bout a VA backed loan? Answer? Federal government. Fannie Mae, Ginny Mae, Freddie Mac loan they purchased from your mortgage originator’s bank? Quasi-government. Would your bank have given the borrower the loan without these entities? Probably not.  ZERO money down, USDA rural housing loan? Federal government.   Have a few of these opportunities been shut down for a spell?  Yes.  Can we still get a loan closed?  Yes.

The Federal government shutdown has absolutely caused a ripple effect within the industry. Contrary to cool sounding popular sound bites like, “Government is stupid!,” the lending world wouldn’t exist without the system in place. “Good!,” some may say. Well, more often than not those are the same folks that want a loan for very little down payment, at a super low interest rate (Government!, but interest rates are a different blog post).

Despite the government shutdown it seems the industry will survive. Sure we’ll have to adjust to time constraints and limitations, but closings are still happening. Shoot, some lenders are taking full blown advantage of the situation. To illustrate, 2012 tax extensions are due on Oct. 15. That stated, most underwriters would require IRS proof of tax returns/income. Well, the IRS is closed. What to do? What to do???? Due to the shutdown, as a means to keep their pipeline flowing some lenders are waving this ‘condition.’ Some are even advertising it as a way to fetch new business. #MakeItHappen

I guess what I’m getting at is, while the government shutdown is “a thing,” the industry isn’t going totally berzerk (at least we’re not). That said, if you’re experiencing trouble with a transaction, give us a call and we’ll try to help you navigate through the problem.

Thank you!


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