When the federal government is shut down, what happens to HECM applications?
The Federal Housing Administration (FHA) is a federal government program that oversees HECM applications. The FHA has temporarily halted the insurance of new HECM loans but will start doing so once the government is back in operation.
It is still possible to submit applications and have them underwritten. The FHA insuring process will take place at a later time.
Staffing is reduced as a result of the recent government shutdown, and the following services have been impacted:
- No processing of tax transcripts (4506-T).
- Federal tax lien(s) verification and payoff/demand(s) cannot be obtained
- Credit Alert Verification Reporting System (CAIVRS) cannot be cleared or updated
- FHA Insurance Endorsements
- FEMA updates indicate disaster declarations.
- Case assignment corrections, cancellations, reinstatement requests, and EAD updates are delayed due to limited staff availability.