The housing giant is unaffected by the shutdown as it is still a private company, albeit in conservatorship.
However, the government shutdown still threatens to delay the process of obtaining a home loan. Fannie Mae required lenders in some cases to verify Social Security numbers and Internal Revenue Service Tax transcripts but will be unable to do so during the shutdown.
Verifying employment could also prove to be difficult in the case of government workers affected by the furloughs.However, Fannie Mae has temporarily revised its selling guidelines to permit lenders to verify Social Security and IRS transcripts after the closing of the loan but before the delivery of the loan. If the transcripts and Social Security number cannot be validated prior to the delivery of the sale, however, the loan would not be considered eligible for sale to Fannie Mae. Also, the shutdown may impact the ability of government workers to make scheduled mortgage payments. Fannie Mae permits servicers to offer these workers an unemployment forbearance plan for a period of six months or until the shutdown period expires, whichever is first. Servicers must also suspend credit bureau reporting for borrowers granted unemployment forbearance related to the shutdown. They must also waive late payment charges if the borrower's payment is late because he or she has been furloughed or received reduced pay as a result of the shutdown and accepts a relief option from the servicer. The changes to the guidelines are temporary and will expire when the federal government resumes operations. If the government shutdown lasts for a prolonged period, the agency might provide further guidance. The Department of Housing and Urban Development has warned that a prolonged shutdown could affect sales of homes and the housing recovery. While the Federal Housing Administration will continue to endorse loans, it is working with a limited staff and borrowers should expect delays, the agency said. -- Written by Shanthi Bharatwaj New York. >Contact by Email. Follow @shavenk
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV