WASHINGTON (AP) -- President Barack Obama says a failure to increase the government's borrowing authority would effectively shutter the economy.
Obama told reporters at the White House Friday that would have a `profound destabilizing effect' on the U.S. and global economies.
The DC offices of Housing and Urban Development (HUD) put out a 'contingency plan' in case of a shutdown. Their employees approve home loans, and if they are unable to work, processing on FHA and VA loans will grind to a halt.
Veterans and first-time buyers would be especially hard-hit by a shutdown, when it comes to housing.
"I don't think people realize how much it'll affect them, but if the government does shut down, everything is on hold," said Jeremy Schachter, of Pinnacle Capital Mortgages.
"It's not something we need in real estate, and not something we need for the economy as a whole," added realtor Brad Brauer.
"Unfortunately it could affect everyone in the process of buying a home," he told 3TV on Friday.
The government faces two looming deadlines. One is a potential government shutdown Oct. 1 if Congress doesn't approve a short-term spending bill.
The other is a debt limit around Oct. 17 if Congress doesn't increase the government's borrowing authority.