• CMG MORTGAGE, INC. NMLS #1820

Federal Government Shutdown: What you need to know

  • December 27, 2018

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As the partial government shutdown continues, the overall effect on loan programs has been minimal. Each federal and government sponsored entity within the mortgage industry has been affected differently. Here is the breakdown of the effect on loan programs and processes in the coming days.

Loans Types

  1. Conventional Financing – The shutdown will have no effect on conventional loans with Fannie Mae or Freddie Mac.
  1. FHA – The immediate impact is minimal and loan fundings should not be delayed. In 2013 the government shutdown lasted 16 days, and the FHA continued to issue single-family loans for the duration. A similar scenario is playing out today, with the FHA continuing what it considers core business operations (e.g. FHA Connection will remain operational and will issue new commitment authority for the foreseeable future.)
  1. VA – The shutdown will have no effect on VA loans. The VA has already been funded for fiscal year 2019 and will remain operational during the shutdown.
  1. USDA – The USDA will not issue any new guarantees during the shutdown, and loans with conditional commitments cannot be guaranteed until the shutdown has ended. We will allow the funding/purchase of USDA loans that already have the conditional commitment.

Loan Conditions & Process

  1. Tax Verifications – IRS Tax Verifications and 4506-T forms will not be processed by the ITRS during the shutdown. We are temporarily suspending the requirement for IRS Tax or W-2 Transcripts to close a mortgage loan for most loan programs. 
  1. Flood Zone -The Federal Emergency Management Agency announced on Dec. 28 that it would resume selling and renewing flood insurance policies. That reversed a Dec. 26 decision to suspend policy sales and renewals during the partial shutdown.

If you have any questions about how your loan may be affected by the government shutdown, contact your loan officer.

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© CMG Financial, All Rights Reserved. CMG Financial is a registered trade name of CMG Mortgage, Inc., NMLS ID #1820 in most, but not all states. CMG Mortgage, Inc. is an equal opportunity lender with corporate office located at 3160 Crow Canyon Road, Suite 400, San Ramon, CA 94583 888-264-4663. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act No. 4150025; AK #AK1820; AZ #0903132; Colorado regulated by the Division of Real Estate; Georgia Residential Mortgage Licensee #15438; Illinois Residential Mortgage Licensee; Kansas Licensed Mortgage Company #MC.0001160; Massachusetts Mortgage Lender License #MC1820 and Mortgage Broker License #MC1820; Mississippi Licensed Mortgage Company Licensed by the Mississippi Department of Banking and Consumer Finance; Licensed by the New Hampshire Banking Department; Licensed by the NJ Department of Banking and Insurance; Licensed Mortgage Banker – NYS Department of Financial Services; Ohio Mortgage Broker Act Mortgage Banker Exemption #MBMB.850204.000; Licensed by the Oregon Division of Financial Regulation #ML-3000; Rhode Island Licensed Lender #20142986LL; and Licensed by the Virginia State Corporation Commission #MC-5521. CMG Mortgage, Inc. is licensed in all 50 states and the District of Columbia. Offer of credit is subject to credit approval. For information about our company, please visit us at www.cmgfi.com. To verify our complete list of state licenses, please visit www.cmgfi.com/corporate/licensing and NMLS Consumer Access (www.nmlsconsumeraccess.org).