The government shutdown is sowing “confusion and fear among borrowers” about their ability to close loans, David H. Stevens, president and CEO of the Mortgage Bankers Association (MBA), said in a statement.

Some furloughed workers already may be grappling with the shutdown’s effects on the mortgage market, he said.

“The furloughs can disrupt time-sensitive mortgage transaction deals by interfering with borrower lock agreements and causing interest rate disparities from the time of closing to the time the loan is securitized,” he said.

If the crisis drags on, he added, it will impact a wider range of borrowers as well as the broader housing market and economy.

“Lenders processing loans that need tax transcripts, Social Security number verification, or FHA home loans face longer delays and reduced functionality from HUD, IRS and the Social Security Administration,” he said. “Different loan programs have different requirements, and these disruptions impact lenders in different ways, leading to confusion and fear among borrowers about whether they will be able to close on a home purchase or refinance.”

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Time is running out to secure your Connect Now tickets at the lowest price. Don't miss out on a chance to grow yourself and your business.Learn More×
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription