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How the Government Shutdown Will Affect Home Loans

by Nena Perry-Brown

The ongoing federal government shutdown doesn't appear to be coming to an end soon and is having far-reaching effects on the real estate industry, from the hundreds of thousands of federal government employees who will likely be unable to make rent or mortgage payments, to the expiration of funds for housing voucher recipients. Today, UrbanTurf takes a closer look at how the shutdown could affect home loans.

Fannie Mae and Freddie Mac will likely still continue processing mortgage loan applications despite the shutdown, Bankrate reports. However, federal government employees in the midst of buying a home may not be able to have their incomes verified. 

Fannie Mae has issued guidance for how its verification and approval process will operate, noting that some aspects of the process (like acquisition of IRS transcript verification reports and social security verification) will be delayed until the government is funded and operational. The agency will not be able to purchase loans closed and delivered prior to an applicant having verbal verification of employment, however. Mortgagees may also be able to secure mortgage loan forbearance if they are not being paid during the shutdown.

The Federal Housing Administration (FHA) may become backlogged with mortgage loan applications due to having fewer staff on hand. However, the impact of this slowdown pales in comparison to the agency's inability to endorse reverse mortgages. The Department of Housing and Urban Development (HUD) will also (slowly) continue to approve mortgage loans for single-family homes, although the agency will be be unable to approve financing for pending multifamily projects. 

This article originally published at https://dc.urbanturf.com/articles/blog/how-the-shutdown-will-hamper-federal-mortgage-loans/14857

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Looking to Give People A Reason to Stay Past 6pm
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Arlington’s Neglected Stepchild is Getting a Makeover
Crystal City
Turning Lemons into Lemonade
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Developing An Air of Exclusivity?
Rosslyn
Hitting Its Growth Spurt
Shirlington
An Urban Village Hitting Its Stride
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Virginia’s Small Town Near the Big City
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The Vibrancy Might Take a Few Years
Huntington
The Quiet Neighborhood By the Beltway
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132 Commerical-Free Acres
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Staying the Same in the Midst of Change
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Radical Change Could Be On The Way

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Bedroom Community Gets Buzzing Cache
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Affluence, Green Lawns and Pricey Homes
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Experiencing a Resurgence After a Bumpy History
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A Suburb on Steroids
Rockville Town Square
Despite the Dynamism, Still Somewhat Generic
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More Than a Little Bit Quirky
Wheaton
A Foodie Magnet on the Verge of Change
Capitol Heights
Kudzu, Front Porches and Crime
Hyattsville
Glass Half Full or Half Empty?
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Artists, Affordable Homes and A Silo Full of Corn
National Harbor
A Development Rises Next to the Potomac
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A Town Looking For Its Identity

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DC’s 535 House Neighborhood
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Do You Know Where That Is?
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Not to Be Confused With the Other Chevy Chase
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Coming Back After A Rough Year
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DC’s Most Diverse Neighborhood, But For How Long?
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The Best of DC (For a Price)
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350 Homes Just West of Georgetown
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Georgetown
History, Hoyas and H&M
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The Duke’s Former Stomping Ground
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DC’s Garden of Diversity
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A Suburb With a DC Zip Code
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Not To Be Confused With Takoma Park
Tenleytown
Not Quite Like Its Neighbors
U Street Corridor
The Difference a Decade Makes
Woodley Park
Deceptively Residential
Adams Morgan
No Longer DC’s Hippest Neighborhood, But Still Loved by Residents

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New Development Could Shake Up Pastoral Peace
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Not to Be Confused With Bloomingdale
Fort Totten
Five Years Could Make a Big Difference
H Street
A Place To Party, and To Settle Down
Langdon
The Northeast Neighborhood That Few Know About
Michigan Park
A Newsletter-On-Your-Doorstep Community
NoMa
Evolving from a Brand to a Neighborhood
Rosedale
Ripe for Investment Right About Now
Trinidad
The Difference 5 Years Makes
Woodridge
Big Houses, A Dusty Commercial Strip and Potential

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Future Promise Breeds Cautious Optimism
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A More European Way of Living

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