Mortgage-processing delays expected with government shutdown

Advisors


“The government shutdown will have an impact on real estate transactions should it continue for an extended period of time,” said Elizabeth Mendenhall, president of the National Association of Realtors, in a statement to CNBC.

The shutdown, which began Saturday after congressional leaders failed to reach a spending agreement to keep the government funded, means that many federal functions are shuttered.

With hundreds of thousands of government workers furloughed — excluding those considered essential employees — paperwork backups are likely to occur in the mortgage-approval process.

Borrowers with loans from the U.S. Department of Veterans Affairs, the Federal Housing Administration or the Rural Housing Service will feel the most direct impact because furloughed workers are involved in processing those loans. However, those loans comprise a small fraction of mortgage loans processed nationwide, according to Zillow.



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