Continued Shutdown Bad News For Mortgage Market (WORSE Than Already??)

Confounded Interest ^ | 10/04/2013 | Anthony B. Sanders

[whitedog57]

What does the government shutdown mean for the mortgage market?

Fannie Mae and Freddie Mac aren’t affected by the shutdown. While the FHA is still processing loans, it’s operating with a vastly reduced staff, which could lead to delays. The FHA is part of the Department of Housing and Urban Development’s Office of Housing, which has just 64 of 2,972 employees reporting to work right now.

The biggest issue facing the mortgage market is that the Internal Revenue Service isn’t issuing Form 4506-T, which is what most lenders currently use to verify borrowers’ incomes. For loans ready to close now, most lenders probably ordered those forms weeks ago, said Bob Walters, chief economist at Quicken Loans.

Nick, you mean worse than it already is?? Mortgage purchase applications are stuck at 1996 levels.

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True, according to AP, the Department of Housing and Urban Development (HUD) has only 6 percent of its workers listed as essential. The Internal Revenue Service has only 9.3 percent working during the shutdown.

Face it, real median household income continues to decline.

household-income-monthly-median-growth-since-2000

And labor force participation continues to fall with declining real median household income.

lfpmedrealinc

At least the US Treasury 10 year yield has remained calm during the Federal government shutdown.

ust10hut

But without an increase in real median income, the housing recovery (other than investors and elites) will be thwarted.

[whitedog57]

Boo hoo.

[Scooter100]

Shut it down. Shut it all down, until weeds are growing in the center of Pennsylvania Avenue.

[Conspiracy Guy]

Mortgage market has been bad since 2008 for the average buyer. It has not improved at all. Now 4 days of Obama/Reid shut down is to blame for 4.5 years of Obama/Reid bad policy.