The government shutdown is entering its second week, but some mortgage professionals say that while the loan process has slowed, their customers aren’t feeling the pinch yet.
Marc Jalbert, branch manager at Colonial National Mortgage in Boulder, Colo., said it’s business as usual at his company – although some “back-end processes” have slowed since the shutdown.
“I think everyone’s just shrugging their shoulders and thinking it’s a bit of a comedy show,” Jalbert said. “We’re still lending as usual. We do have some back-end processes that are affected by the shutdown … so it is definitely hampering our processes, but we’re still lending as usual. Our customers seem to be annoyed more than anything.”
“I’ve seen a few people asking questions about it, but unless this drags on, I don’t foresee any huge impacts or huge delays,” said Kevin Phillips, mortgage consultant with CMG Financial in San Diego. “The longer it goes, I think then you’ll start to see more of an impact and more fear.”
Mat Ishbia, president of United Wholesale Mortgage in Troy, Mich., said the shutdown hasn’t significantly impacted the wholesale space, either.
“It hasn’t affected us much,” Ishbia said. “The 4506 -- the IRS transcripts that lenders get to verify income -- that’s shut down right now, so we’re having to find alternatives to that. … But you can still do (Federal Housing Administration loans) -- they’re still open. I wouldn’t say there’s no impact on lenders’ businesses, but I would say it’s less than most people would perceive.”
One loan product that has felt the crunch, Ishbia said, was Department of Agriculture loans for homes in rural areas.
“The big thing it’s affecting is that if you’re doing USDA loans, the USDA process is pretty much completely shut down at this point,” Ishbia said. The USDA has gone almost entirely dark during the shutdown; on Friday, the agency’s web address redirected to a page stating that the website was temporarily offline “due to a lapse in federal funding.”
Still, Ishbia said, the shutdown doesn’t seem to have frightened customers away.
“I would say there’s very few (borrowers) who are impacted significantly,” he said. “There are some borrowers and some loans that will get caught up in this, but it’s not widespread.”
Jalbert agreed. “The whole thing is a bit surreal, I’d say, more than anything. Most people I know think it’s temporary,” he said. “…In the meantime, I think we’re going to continue to see low rates, and eventually we’ll see the government shake off all this bullshit and it’ll be business as usual.”