JACKSONVILLE, Fla. — The government shutdown is rippling through the housing market, slowing down sales and loans.
A local mortgage broker said it is leaving both buyers and sellers in limbo.
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“It doesn’t look that good,” said Tim Newman, with the North Florida Mortgage Brokers. “If you’ve been furloughed, you no longer have active employment, and your home buying process has just stopped abruptly.”
Government-backed mortgage programs are taking a hit.
“You are going to completely see a stoppage of USDA loans, which support rural housing,” said Newman. “That program is not issuing any loans at this point. That’s completely stopped.”
Newman said buyers using Federal Housing Administration or Veterans Affairs loans may also face significant delays.
He adds that the closing times for those loans are going to take a little longer.
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“A typical loan can close in 30 days,” said Newman. “Now it’s going to be closing in a time frame of 45. Not the end of the world, but if you are in a tight squeeze and under contract to sell your home and then buy another one, that might be an issue.”
Another concern is flood insurance.
Before homebuyers can close on a property, some lenders require proof of flood insurance coverage.
But during the shutdown, the National Flood Insurance Program cannot issue or renew new policies.
“If your home is located in a flood zone, matters just got a little bit worse for you,” said Newman.
Newman said the best move right now is to get help from professionals.
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