Federal Shutdown Could Delay Closings
April 7, 2011
A federal government shutdown could have an impact on the ability to close transactions.
Several agencies released details about their plans if the government shuts down, which could happen Saturday if a budget compromise isn’t reached.
In the event of a shutdown, the U.S. Department of Housing and Urban Development’s Federal Housing Administration would cease operations. According to the FHA, new loan guaranties would not be processed. It’s been reported lenders could still approve loans, according to FHA guidelines, to get deals closed, and then get FHA to endorse those loans after the fact.
Fannie Mae and Freddie Mac would not stop operations during any shutdown. Operations at the Department of Veterans Affairs also would continue.