Oklahomans Worried About What A Default Would Mean To Them

Friday, July 29th 2011, 6:40 pm
By: News On 6

Emory Bryan, News On 6

TULSA, Oklahoma -- Lawmakers aren't the only people getting calls about the debt crisis, bankers and investment advisors in Oklahoma are too.

Several investment advisors say they are hearing from clients wanting to protect money in the stock market by converting it to cash.

And there's another concern coming from people in the process of getting loans.

The threat of default has potential to impact all sorts of government payments, and what happens in the capitol could even influence home mortgages here in Oklahoma.

"This will probably be a blip and not a long term problem, but if it gets extended out absolutely, government employees could be furloughed, and it could hold up the loan process," said Arvest Bank Mortgage Manager Shawn Karnes.

Since new loans often require government issued paperwork, a furlough could delay banks trying to close on loans. Existing loans, with fixed rates, would not change. And Karnes doesn't think interest rates will change much, even if there is a default.

"And in the short term, they might bump up a quarter of a half percent, but in the long term, we're confident that interest rates will remain very low," he said.

Friday morning, the president called the interest rate issue another kind of tax increase.

"Would result potentially in a tax increase on everyone in the form of higher interest rates on their car loans, credit cards, and that's inexcusable," the President said.

Some investors are feeling blue these days, but investment advisors urge caution before making sudden decisions based on speculation of a default and the impact on the market.

Political leaders are still arguing and no one knows how their compromise or lack of it will impact the citizens they represent.