Government shutdown hits mortgage market - News, Weather & Sports

Government shutdown hits mortgage market

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Steve Adams Steve Adams

LOUISVILLE, KY (WAVE) – If you're actively in the market to buy a new home or business and need a mortgage, the process is now delayed due to the government shutdown. In fact, you may not be able to close until Washington reaches an agreement.

When putting down a contract to buy, the loan officer verifies the buyer's social security and income to move forward with closing but because the SSA and IRS are shutdown, the process is paused.

"They will bring in their W2s, their taxes, or any other financial records and they will disclose their social security number to us," said Steve Adams, a loan officer at Stock Yards Bank. "We have to verify both of those are accurate with what the IRS and Social Security Administration actually have."

Many buyers are looking to snatch a new home before any hike in interest rates. Right now, the rates that customers lock in could expire.

"If we do a short term lock on something and then we're down to the wire trying to get some of the information that we need to verify social security numbers," Adams said. "Or to verify the income that's been disclosed to us initially and then there's extension fees, the question is, ‘who's going to pay those extension fees?' it's not the customers fault."

Adams said they haven't decided what they will do but the customers won't have to pay. For now, they're sending in the documents to the SSA and IRA in hopes Washington will resolve the issue shortly and business will resume.

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