The Impact of the Government Shutdown on Mortgage Loans

Here are some answers from Prosperity Home Mortgage LLC to frequently asked questions about the impact of the government shutdown on mortgage loans. Please contact your mortgage consultant with and questions or concerns about specific loan transactions.

Will the flood certification process be affected?

For the most part, a flood certification process will not be impacted. However, if a situation requires additional research, such as mapping issues, the flood certification process will be impacted.

What about loans requiring social security number verification?

The Social Security Administration will not process any SSA89 forms. Loans requiring social security validation will not close until a completed validation is received.

Will the IRS process tax transcript requests?

The IRS will not process any tax return or W-2 transcript requests. However, tax transcript requirements are temporatily suspended, except for USDA loan transactions. Loan files must contain a signed 4506-T at closing.

What is the impact on USDA loans?

USDA is unable to issue new commitments or guarantee closed loans. Effective December 15, 2018, USDA loans require tax transcripts. USDA loans cannot close without full tax transcripts for all adult household members.

How are government employees affected regarding employment verification?

If a borrower works at an agent that does not use a third-party verification resource, then employment verification cannot be completed. Loans cannot close without a 10-day verbal verification of employment (VVOE).

How are FHA, USDA, & VA questions escalated?

Government agencies will have limited staff available to answer questions or correspondence. Lenders intend to answer questions in a timely manner; however, they may be delayed in responding while we wait for clarification from the government agency.