The current government shutdown has far reaching effects including the mortgage industry. There may be some disruptions to closings as follows:
The IRS and SSA have temporarily ceased operations. As a result, tax transcripts and SSN verifications will be unavailable until government operations resume. We will consider loans requiring transcripts and SSN verifications on a case by case basis if we have any flexibility for proceeding with closing.
As usual, loans for borrowers who are W2 employees do not require transcripts.
Fannie Mae and Freddie Mac are not affected by the shutdown.
FHA/Ginnie Mae – we think that HUD and Ginnie Mae will retain much of their functionality and FHA loans should not be affected short term. The FHA Resource Center will be operational but on a limited basis.
VA – in previous shutdowns, the VA has been exempt and has continued with full functionally.
USDA – we believe that the shutdown will impact Rural Housing’s ability to issue loan commitments and to guarantee loans closed with outstanding commitments. We plan to continue closing RD loans that have already been issued a commitment.
There is another vote today at Noon in the Senate for a Continuing Resolution to resume government operations for another three weeks while an appropriations bill can be negotiated and passed. If the CR is passed, it would still need to be approved by the House and the President.
We will keep everyone posted as more information becomes available.