What Does the Government Shutdown Mean for the Housing Market?

This is not helping...

This is not helping…

As we enter the second week of the government shutdown (insert expletive or groan here) some parts of the housing market are feeling the effects of the inactivity. When people ask me what this means for the housing market especially in Reno/Sparks, I can say there might be delays in the process and the following:

  1. Lenders can delay some loans because they rely the IRS to verify a person’s income and, of course, the IRS is shut down, however, many lenders have the individual bring in their tax returns with the intention of verifying it with the IRS once the shutdown is over.
  2. Furloughed government employees may have to put the break on buying a house with no guarantee of when they will be payed next, and if they’re already in escrow, a delay may force them to pay a penalty to the seller.
  3.  People using USDA or some VA loans are out of luck–until the government re-opens, they will have to wait on loan approval.

Despite all this, most loans are going through because so much of it is automated. How is this shutdown affecting you?

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