Though the media and both political parties would like you to believe that there will be no immediate impact on American businesses, that isn’t exactly true for the Mortgage industry.
Here at Mason-McDuffie Mortgage we want to make sure that everyone understand exactly what the impact will be if you are currently in process for a Mortgage Loan or starting out the Loan Application process.
The Immediate Impact:
Mortgage Lenders need to verify Social Security Numbers for all borrowers. Currently this is not possible due to the shutdown.
All loans that are in need of tax transcripts to continue processing or get final approval of your loans will be delayed until the shutdown is over.
The shutdown has caused the USDA offices to close. This means that existing loans that have been submitted to USDA for review will be delayed until their offices reopen. This also means that Rural Housing’s GUS approval system will be unavailable. Finally, Rural Housing will not issue Loan Note Guarantees or issue any new commitments during this time.
HUD/FHA/VA should continue somewhat normally provided that the shutdown does not drag on too long. There will be some reduced functionality and possible delays due to limitations in staff.
Borrowers that have been furloughed and whose employment is directly affected by the Government shutdown can expect delays in processing and/or closing of their loans.
According to the MBA, “A shutdown lasting a few days would slightly inconvenience lenders in processing loans, however a longer delay would have more serious impacts. Purchase loan volume could shrink and impede the recovery of the housing market. Additionally, long-term furloughs may disrupt time-sensitive mortgage transaction deals by interfering with borrower lock agreements and causing interest rate disparities from the time of closing to the time the loan is securitized.”
We will keep our customers and business partners informed with any updates. We all hope that the Government Shutdown will be short lived and will be brought to a resolution soon.
– Mason-McDuffie Mortgage