Oct 21, 2013
So the Government is shutdown, now what? This is a common question being asked by many hopeful home owners. If you plan on getting a mortgage backed by Fannie Mae or Freddie Mac, then your income must be verified with the IRS first. According to the article Shutdown could slow mortgage lending, this could possess major complications and cause serious delays when it comes to securing a mortgage.
Fortunately, Fannie Mae and Freddie Mac have given banks the green light to relax the rules regarding the approval of mortgages, as mentioned in the article Fannie, Freddie ease lending crunch during shutdown. All borrowers still need to have their income verified but lenders are allowed to utilize others avenues for verification or they are able to wait to verify income until the shutdown has ended. Even with the ease up on the mortgage lending rules, some banks may decide that lending without verification is too risky and will wait until the shutdown has concluded before finalizing any mortgages.