Friday, October 4, 2013

Shutdown will stall home loans for thousands

Week #5
Article #2
1.     Category of problem: Politics
2.     Level of problem: National
3.     This article concerns: All individuals that are applying for any loans, especially potential homebuyers. 
4.     Importance/effect on families/individuals: This article will affect families and individuals wanting to buy a house or obtain a loan for other reasons. Since the shutdown will affect the IRS, there will be no paperwork; therefore banks will not be able to determine a person’s income and other important information, making it difficult for banks to determine what mortgage individuals qualify for.

My input:  In this article, the government shutdown’s effect on mortgages is discussed. Many homebuyers will be expecting some trouble when applying for mortgages or other loans. Many banks do not want to approve mortgages because they do not have the necessary documentation from the IRS; therefore they are struggling whether they should approve loans and then ask for further documentation once they have been revised. But for right now many requests have been frozen because banks do not know what process they should follow. In my opinion, mortgages should continue to be approved with further documentation because if banks slow the process of obtaining loans, then it will have a greater effect on our economy after the government shutdown.

1 comment:

  1. When I first heard the talk about a possible government shut-down, I didn't realize all of the ways in which we would be affected by it. It's heartbreaking to hear that people are in danger of losing their homes, and people who had already gone through the lengthy process and had their hearts set on purchasing a home have no idea what/when to expect the issue to be resolved. It does seem like banks and mortgage companies would have other ways of verifying income, but verifying someones identity plays a huge role in their approval as well, and that's almost impossible without the aid of the Social Security Administration. It's unbelievable that neither party will budge and come to a compromise to avoid detriment of our economy. It feels like everything happened so quickly. Even though there had been talk about it, didn't most people think the shut-down wouldn't really happen. I thought surely it was just a scare tactic, but I was clearly wrong. This is going to far. And it's still all very confusing...I'm thankful that myself and my family have yet to be personally affected by this absurdity, but I'm truly heartbroken for the millions of others who are struggling, aren't getting payed, have no chance of approval for loans, etc...This is such a HUGE deal and it's scary to think that, as of yet, there's no end in sight.