While our elected leaders remain deeply divided over the pending implementation of Obama Care, a little known by product can and will affect all of us in the real estate industry. If lawmakers in Washington can't figure out a way to avoid a government shutdown, then pending FHA, VA and rural loans are at risk of falling through. How likely will this happen you ask? Consider that 60% of the government will continue to function, but agencies such as passport issuance, FHA and VA loans and other government agencies will completley stop come midnight tonight.
“FHA will be unable to endorse any single-family loans and FHA staff will be unavailable to underwrite and approve new loans,” writes HUD in its shutdown contingency plan PDF
This is also true, reports CNN, for VA loans and for the rural development loans of the United States Department of Agriculture.
Some say a day or two won't make a difference, I beg to differ, when timelines need to be met and monies are invovled we all want to protect our clients' interest, and knowing what lies ahead will help us all deal with the current situation in an effective way.
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