The government shutdown has severe ramifications for many people. One that will affect your loan in process is that the IRS will not be validating tax returns. Part of the loan process is for the lender to validate your income directly with the IRS. They match what you claim on your tax returns to what you have provided the underwriter as proof of income. The reason for this income validation is due to all the income fraud in years past. A successful income validation is a requirement for every loan, so if the underwriter is unable to satisfy this, your loan will be delayed.
It was anticipated that FHA would shut down, but this is not the case. They are still processing and insuring FHA loans, so if you have an FHA loan in process, you will not be affected.
