Government Shutdown Stops Loan Processes

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How does the government shut down affect my loan?

(See comments below this post for updates to status on processing…good news there!!!)

Very quickly, I wanted to post another message about how the Government Shut Down is affecting borrowers using home loans to purchase or refinance their homes right now.  This is part II of posts on this topic.  Original thoughts that came out were more optimistic than what has resulted in the industry.  Please see part Iafter reading this post.

Bad news for USDA Borrowers

 I can not speak for EVERY lender or investor out there, but I can not see how it could be much different from one lender to the next.  That being said, we are being told that USDA is shut down right now.  No loans in process are getting closed.

Bad News For All Borrowers?

Regarding all other loans, FHA, VA, Conventional, etc… The 4506 that is ordered from the IRS and is used to confirm accuracy of tax returns, these are not currently getting processed by the IRS.  That means, any loans in process or that are needing to get processed soon that do not already have 4506′s, these loans will not close until the IRS gets a plan to process these.  On the other hand, word is that the different lenders are getting together to figure a way to get these all closed without the 4506 if this continues for another couple of weeks.  Best of luck!

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