Q: I’m applying for an FHA home loan and my lender has just notified me that they need a transcript of my IRS records, but the government shutdown has closed the IRS. What will happen to government-backed loan applications in process when the shutdown started?
A: the answer depends on your lender. The IRS has shut down the majority of its operations; it’s unlikely that the document your lender needs will be available until the shutdown is resolved. Talk with your loan officer to see if alternative documentation can be submitted in place of the IRS document. Many lenders have altered their policies and are finding alternative ways to verify income during this time.
FHA and VA Loan Processing Continues
Most applicants for VA and FHA loans will probably encounter few shutdown-related problems..
The Department of Veterans Affairs (VA) is processing home loan applications. The Department of Housing and Urban Development (HUD) originally announced that it would cease endorsing single family home loans for FHA’s Mutual Mortgage Insurance program, but has since reversed its decision. FHA will continue approving loans submitted for endorsement by its approved mortgage lenders,
As with the IRS, the VA and FHA will be operating with reduced staffing. Staffing and operations for federal programs is subject to change during the shutdown. Fortunately, many VA and FHA-approved mortgage lenders have the authority to approve and fund loans without the involvement of government agencies. Some lenders will choose to approve the loans and get their government insurance later; others will not. You’ll want to ask your lender if it’s capable of closing your loan on time and willing to close it on time even if the shutdown continues, especially if you have a home purchase in the works.
Feel free to contact LendingTree’s network of mortgage lenders for mortgage quotes and information about FHA and VA loans.
- Your Mortgage GPS: Step-by-Step Directions for Getting a Mortgage 9,751 views
- 15 Things to Know About Your New EMV Credit Card Chip 7,039 views
- Should You Give Out Your Social Security Number to Get a Mortgage Quote? 6,539 views
- The Ultimate Credit Score Survival Guide: 45 Rules to Help Increase Your Credit Score 5,189 views
- 5 Things You Should Never Put on a Credit Card 4,160 views
- How Do You Compare Personal Loans and Get the Best Deal? 3,661 views
- Avoiding the 5 Most Common Mishaps People Encounter When Buying a Home 3,113 views