Posted on 10/05/2013 9:34:46 AM PDT by BenLurkin
COSTA MESA (CBSLA.com) — The government shutdown could bring the Orange County real estate market to a standstill.
“We have to verify tax returns through the Internal Revenue Service for all loan transactions, and so we can’t do that right now with the government being shut down,” said mortgage broker, Lauren Stipe.
Stipe said buyers can’t get a loan without the 4506 forms.
“(I have clients) waiting and, basically, hoping that we’ll get the results back in time for them to close escrow on time,” she said.
Stipe is hopeful the shutdown will end soon. But if it doesn’t, she’s worried buyers will fall out of escrow and be forced to cancel their contracts.
“I think worst case scenario, if they remove loan contingencies, they have the potential of losing their deposit on the house,” she said.
KCAL9’s Stacey Butler reported that so far, there have been few disruptions. Most loans close at the end of the month and take 30 to 60 days.
Traditional loans aren’t the only ones affected.
Loans backed by agencies like the Federal Housing Administration could also be in jeopardy as the FHA’s diminished staff struggles to keep up with processing.
“I’m hoping that like previous situations, they’ll resolve it within a matter of days,” said Stipe.
Awwwwwwww!
BINGO!! THAT is going to be the end result of all these sob stories....the GOVT. IS TOO DAMN BIG!!!!!
My first thought as well. Government shouldn’t be involved in the housing market at all.
Just another example of the government being TOO BIG! The government shouldn’t be involved in real estate sales. It’s not in the Constitution.
The 4506T audits are a big deal for mortgage lending. We send in the signed 4506 form to the IRS.
The IRS then send back to us a transcript of someones tax return with all the data from their return.
We match that up with tax returns W2’s or paystubs (all of which could potentially be fake) we have collected from a borrower.
It is a way to detect possible loan fraud.
So yes the govt has it’s fingers in too many things; but this isn’t one of them.
Call your commie 'critters and tell them to fold.
In an area plagued with earthquakes and mudslides a real estate standstill is a good thing.
Bring it on --
Somehow people bought and sold land in America for hundreds of years before the mortgage world decided they needed a federal police force to do their due diligence for them.
Why isn’t a triple agency credit report enough for you?
Is the 4506 required by federal regulation?
Would you just fold and go out of business if you didn’t have it?
Just because someone, somewhere benefits from an overly intrusive government does NOT mean that it is justified.
Regards,
Isn’t it amazing that the feral government has its nose in everyone’s business to this extent. Shame on we, the sheeple, who have allowed this rapacious government to run wild.
And the Government Shutdown COULD make monkeys fly out of my butt.
Government does a fine job of bribing supporters.
The people who are easily bought have been with us since the beginning. In the 1700s they turned their neighbors in to the king for their 30 pieces of silver. Today they do the same for other payoffs.
The Democrats may get confused. They will now have to decide whether to blame their failures on the partial shutdown, Bush or global warming.
I have been connecting some other dots....
The shutdown is a problem when the Feds have so many fingers in the pie, no doubt.
BUT—When Obamacare kicks in & people find out how expensive it is going to be & how high a series of decuctibles there are:
What will they have to give up?
Many homeowners who are already paying mortgages on proof of money they earned before their hours were cut to 30 per week will have to make some choices.
They are earning less & will have to pay seriously spiked premiums for ‘health care’.
Will they give up their cell phone plans? A penalty connected to that, for sure.
Will they turn in their newer car & drive an older one instead? Fat chance. They have been brainwashed to believe that only the NEW cars are safe!!!
Will they give up the beauty parlor & manicures? Not betting on that.
350 channels on their TV? Not so sure about that, either.
Dining out & family gatherings?? No—not that.
Will they find themselves paying their mortgages later & later??? Perhaps. There isn’t as much instant gratification with a mortgage payment as there is with a cell phone or a new haircut.
This will start another complete round of foreclosures-—just when the home market was starting to feel a little better.
Watch what happens-—within another year, before the 2014 elections, the foreclosures will go waaaay back up.
See if I am wrong. Remember I have said this.
Credit reports have nothing to do income verification.
W2’s; paystubs can easily be created in Photoshop.
Government regulations DEMAND this type of verification is done.
Don’t blame lenders for doing what they are required to do.
The regulation is a pain the ass for all of on the lending side.
If you get a loan as a customer; you just have to complain about on your loan and be done with it. Every loan I deal with I have to deal with this stuff, not fun at times.
And yes we can’t make a loan without this. It’s actually one thing however that makes some sense; as it will stop some loan fraud.
The lenders aren’t cheering to do however; as it adds costs and time and complexity to the process.
Makes me feel kinda blessed to have been raised poor.
Things have got to get pretty bad before “hardship” becomes depressing. Basically I’d have to reach the point of living in my van and even that might be tolerable.
You seem to be a creature of your age.
In the 1970s we sold cars, trucks, houses and land on credit with zero government involvement. Well, there was the County Recorder.
“Identity theft” is a crime only known in the age of mass illegal immigration. Another charming feature of Mexico that has changed the U.S. in ugly ways.
Income fraud used to be easy to check: you just called the guy’s employer and asked them what he made. That’s probably illegal now, right?
Self Employed had to provide accountant reports. Don’t got one? Fine. Put down 30%.
And if you don’t make the payments...meet Vinnie, our Repo guy.
I have no idea why you think you need a federal agency to do these things. Have been in and out of sales in all sorts of businesses over the decades and not once do I recall needing some jerk who got his job with federal points to make it work.
We just did a refi on our home. The lenders are assuming you are lying about everything and you have to provide 2 different ways to backup your info. In our case my wife recently retired and takes a draw on her reinvested profit sharing account. The lender requested a letter stating the draw agreement had been set up and she had to prove the draw had been made.
She recently had bought out a car lease, she provided the satisfied lease agreement and had to prove that Toyota had been paid for the car.
The whole thing has gotten ridiculous thanks to Barney Frank.
Very few people believe me when I tell them that, for the most part, the young , or those that are considered to be young [college students, high schoolers and grads] do not know how to wipe their butts unless instructed by a Governmental Bureaucrat.
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