How is the Government Shut-Down Affecting Home Sales
The knowledgeable loan officers, Robin McGlone, and Jennifer Hager, from Home Mortgage Alliance, report the following information about how the government shut-down can affect home loans and therefore your ability to purchase a new house. If you have any questions about how this could affect you, please contact your trusted mortgage broker, or feel free to contact Jennifer or Robin directly, and, of course, Tupper’s Team is always willing to help.
CONVENTIONAL/FHA/VA LOANS FOR GOV’T WORKERS IMPACTED BY THE FURLOUGH:
• With the shutdown extending for a longer period of time, Fannie Mae and Freddie Mac are concerned about the impact that continued income interruption may have on borrowers’ ability to meet their mortgage payment and other monthly obligations. In light of this, FNMA has developed this Lender Letter jointly with Freddie Mac and in consultation with FHA.
• Loans for Gov’t employees impacted by the furlough: we are now imposing a minimum reserves requirement, which serves as a compensating factor to offset the risk associated with the interruption of income. The borrower will be required to have 2 months of PITI payments in reserves, at a minimum, in addition to other requirements.
• Loans for Gov’t employees impacted by the furlough: will not require current pay stubs, and will not require a final verbal verification of employment within 10 days of closing, as long as the borrower meets the additional reserve requirements.
LOAN PROGRAM THAT IS IMPACTED BY THE FURLOUGH:
• USDA: No new Conditional commitments from the local USDA office will be issued until the gov’t shutdown ends.
o We must suspend funding of any USDA loan without a Conditional Commitment until the shutdown is over.
o Loans for which we have a Conditional Commitment may be closed and funded without delay.
o New USDA loans will be suspended until the shutdown is over.
January 14, 2019, the IRS will begin processing requests for transcript information made through Income Verification Express Service (IVES) program. Because it will take time to ramp this service up to normal operating status, it may initially take a few days to process these requests, as employees are brought back to work and begin to process requests backlogged since the funding lapse began on December 22, 2018. We expect the IVES system to be back on a 24 hour (or less) turn around by January 22nd.