With the government shutting down, we can expect delays in closings.
During the last government shutdown on October 2013, there were 17% of closings delays.
How this shutdown will affect some housing finance agencies:
- Fannie Mae and Freddie Mac will continue to operate as normal.
- Department of Housing and Urban Development (HUD) and the Federal Housing Administration (FHA), operations will be affected:
⋅ Approximately 96% of HUD’s workforce will not work.
⋅ Out of the 2,506 FHA employees, only 86 will be working.
⋅ In the Office of Fair Housing and Equal Opportunity, only 2 out of the 484 employees will be available.
- As for Ginnie Mae, 14 of the 143 employees will work.
- The Department of Veterans Affairs will also continue to guaranty loans throughout the shutdown however, the IRS will be closed. Therefore, tax return transcripts that are required by various lenders, will be delayed due to the suspension of processing these forms.
What does this mean for Buyers and Sellers?
Buyers and sellers should expect more than 45/60 days to close, due to limited employees processing loans in these agencies through out the duration of this shut down.
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