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Real Estate Agents: How the government shut down will affect your business

With: John Meussner, Loan Officer & Mortgage Coach @ Mason-McDuffie Mortgage

So it’s been a day and the government is still shut down.  What exactly does that mean?  I’ll spare the humor and all the things I’d like to say – basically it means that some services are available, and others aren’t.

     While many vital services are still in action and exempt from shutdown, many others have been frozen, and could inadvertently have a pretty poor effect on the housing market, especially if this shutdown lasts for more than a couple days.

Please note: Not all lenders will have the same processes during a shutdown, just like in 2013. Your experience may vary. For example we are good to proceed on USDA Loans as-is during the shutdown.

USDA loans – the USDA loan program is frozen.  Since files are approved by USDA offices directly, there will be no more guarantees or housing loans issued by the USDA offices until the shutdown is over.  This could have a pretty terrible effect for those who live in rural areas or need 100% financing.

VA loans – VA loans should be in full swing, as the program is run based mostly on fees.  Where there might be an issue is when someone needs a VA certificate.  When the government shut down in the 90’s, there was a delay in obtaining certificates, and this will likely be the case again.  New applications will be taken, and files will be underwritten and funded, though.

FHA loans – FHA loans aren’t expected to feel a real impact from the government shutdown so long as the shutdown doesn’t last for a long period of time.  HUD is running at a significantly reduced staff, though, so getting information and paperwork to & from HUD could take a lot longer than usual.  The good news is, loans will still be insured & they will still have staff delegated to underwriting.

Conventional loans – while many are stating the shutdown is ‘no big deal’ for conventional financing, this is simply not the case.  Yes, conventional loans will be applied for, underwritten, approved, and funded.  BUT, over the past few years, as we all know, lenders have taken extra steps to fight fraud, and 2 of these steps are social security verifications and IRS 4506-t transcripts.  These services will be unavailable, and therefore loan files may be put on hold until the shutdown is over.

     Some borrowers will be in more trouble than others – for self-employed borrowers, they may be at the mercy of the shutdown as a work around for 4506 transcripts isn’t currently available.  Also, for any government employees that are in the midst of the loan process it will be extremely difficult to get any verifications of employment done.

   I’d strongly recommend being proactive in making sure none of your clients are surprised by any potential delays – sellers should understand that the shutdown can cause delays at no fault of buyers.  Anyone buying or refinancing should be aware of what type of loan they are getting, and if the potential is there for delays, they should plan accordingly.

     Hopefully in a day or 2 this blog post won’t matter & things will be running smoothly once again between our elected officials, but as a preemptive stragegy, it would be a good idea to know this information.  And for an added benefit you’ll already know what to be ready for if this happens in the future.

–  John Meussner

Phone
(949) 247-7530
Email
jmeussner@masonmac.com

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Mason Mac Supports Veterans in LA County

Mortgage Lender in Southern CA

This past weekend, Wendy Walker, branch manager of Mason Mac’s Newport Beach/Balboa Island branch and her team represented Mason Mac at the Los Angeles VAREP Veterans Housing summit.  VAREP is the Veterans Association of Real Estate Professionals, a HUD-approved non-profit dedicated to increasing sustainable home ownership, financial literacy, VA loan awareness, and economic opportunity for the active-military and veteran communities.

The LA Veterans Housing Summit event focused on education for veterans with a specific focus on the VA loan program and the home buying process.  Included in the summit was

Veterans Mortgage Loans
Mason Mac is here to serve our veterans and guide them through the VA loan process

information on the importance of good credit, available down payment assistance products, and a summary of the local housing market.

Mason Mac proudly offers the VA loan program throughout the greater LA area (and in all of the markets we serve), with a 2017 VA loan limit up to $636,150 (loan limit varies based on county/area) – Veterans may borrow more than the available market loan limit, however the loan limit caps the amount of money that can be borrower with no down payment for most veterans.

At the VAREP Veterans Housing Summit, Wendy’s team spoke with veterans from all branches of the military, and they were the only non-bank lender in attendance.  Being a non-bank lender, Mason Mac specializes in VA loans with no overlays – that means VA guidelines are our guidelines, and our VA loans are underwritten by our in-house staff of underwriters.

Also on site at the VAREP Summit were local real estate agents focused on helping veterans view inventory of homes in the area that were for sale and of interest to the attending veterans.

The VA loan product is one of the most beneficial loan products available in today’s mortgage market.  For many veterans, here is no down payment requirement, and no monthly mortgage insurance.  Perhaps best of all, rates on VA loans are some of the most competitive across the entire spectrum of mortgage products.  Low rates, no monthly PMI, and a streamlined process make the VA loan a premium product for eligible veterans and their families.

 

Mason Mac offers the VA loan product in every state in which we’re licensed, and the Mason Mac team consists of many VA loan experts that know the product inside and out.  Like Wendy and her team at the LA Veterans Housing Summit, your Mason Mac loan officers are there to educate you and guide you through the process of exploring loan programs, finding the best one for you, and using it to get into your dream home – and if you’re a veteran, the whole process can be very easy and not involve a lot of money.