The Impact of the Flint Water Crisis on Mortgage Lending
With water being so severe in Flint Michigan, the Flint Water Crisis heightens to the field of mortgage and home owning as the crisis continues to plague residents, who now have to deal with the severity and possibility that buyers will not be able to secure home loans in the area as securely as the chance was before according to Wall Street.
Quoted from The article,
“As a condition for making a mortgage against a property, lenders often require that a home meet certain minimum standards of livability, including potable water. Government agencies, which back most U.S. home loans, also have such requirements.
“As we learn more and as this situation evolves, we will work with lenders to determine what policy changes, if any, may be warranted,” Fannie Mae said in a statement. “We feel for the community impacted by the unfolding issues related to Flint, Michigan-area water quality.”
“This isn’t a question of the lenders arbitrarily choosing not to do loans in Flint,” said David Stevens, president of the Mortgage Bankers Association, a trade group. “It’s a question of whether lenders are allowed to originate those loans based on government requirements.”
How the Flint Water Crisis Can Affect You
This not only affects home owners, but this affects lenders as well in the sense that lenders say home buyers must prove there is no contamination at a property or they won’t make a loan for its purchase.
But good news to be told, SBA disaster loans can now be taken place, which must be applied before February 7th. “Approval of economic injury disaster loans will help business owners and non-profits in the Flint crisis, recover from any damages as a result of the water damage.” Governor Rick Snyder states.
Can houses still be sold?
Statements, social media posts and rumors that the water crisis has made it illegal to sell houses in the city of Flint, Michigan are simply not sure with the confirmation of our housing and real agents and legal experts within the area pertaining to the flint water crisis. There have been comments made in media interviews and on social media that it is illegal for Flint residents to sell their homes during the city’s water crisis because of the high levels of lead contamination in the water.
The water crisis emerged in Flint after the city swithced water sources in April 2014. Water untreated for corrosiveness went through the pipes and lead leached into the water, exposing an unknown number of children to a substance that can impair cognitive functions.
The realtors association board of directors had a meeting earlier in January after they started seeing the post appear on social media. Snopes.com confirmed that the crisis led to a number of rumors, but the claims were not valid.