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5 Things You Need To Know About Buying a Home During the Shutdown

We spoke to Steve Grandizio, Vice President of Center City Mortgage, about the government shutdown and it’s effect on the real estate market. These are his insights.


1. Federal Government Employees

If you are a Federal Government employee, you must not be furloughed and your employment must be verbally verified on the day of closing by your lender. Speak to your Realtor® about the possibility of postponing your closing date.


2. Using Federal Housing Administration (FHA) & Veteran’s Administration (VA) Loans

If you are applying for an FHA or VA loan, there shouldn’t be any issues.  Both FHA and VA loan departments are operating without delays.


3. Getting Your IRS Transcript

On every mortgage application, lenders are required to request a direct transcript (4506) of past tax returns from the IRS to make sure that your income matches correctly.  While the IRS is processing these transcripts, they are on a two to three week delay.  Knowing this, make sure that your mortgage lender orders this report very early in the process to avoid any delays in closing.


4. Setting up Flood Insurance with the NFIP (National Flood Insurance Program)

Similar to the IRS, the NFIP is operating and issuing new policies, but with extended turnaround times.  Why does this impact home buyers?  Lenders need to determine if your new home is in a flood zone.  Whether you are buying a waterfront home or one in the desert, a flood certification is required.  Again, make sure that your mortgage lender orders this report early in the process to avoid delays.


5. Using SSA (Social Security Administration) Income to Qualify

If you are using Social Security income in order to qualify for your mortgage, your lender will need to get verifications from the SSA.  The great news is that they are operational without delays.

 


 

With all this in mind, the process may have become more complicated than when you began looking for a home. If you have any questions about where you stand or additional steps you may need to take in this uncertain time, please reach out to your Center City Listings agent.

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