In the wake of Hurricane Sandy the federal government is closed Tuesday which means the Fannie Mae/Freddie Mac trading window is shuttered as well as FHA and VA approvals.
The closings mean there will be no new business sanctioned by government agencies whose loans currently represent 90% of the residential mortgage market. MBS trades with Fannie and Freddie will not happen either.
The federal government and non essential agencies have been closed for two days now which means any progress on rulemaking will be delayed as well.
Mortgage bankers have been anxiously awaiting a final ‘Qualified Mortgage’ rule from the Consumer Financial Protection Bureau with some officials predicting the regulation might possibly be unveiled right before Thanksgiving. However, one government source said a pre-Thanksgiving release was unlikely.
On Monday, Mortgage Bankers Association president David Stevens, and Marc Savitt, head of the National Association of Independent Housing Professionals noted that
Of particular concern are home inspections that occur prior to a mortgage closing. With the storm affecting millions, sales will be delayed until repairs can be made.
“A lot of this is going to depend on how long power is out,” Savitt said.
Brian Benjamin, a loan broker based in Northern New Jersey, said that with Freddie Mac closed a mortgage he is working on will be delayed. “Freddie is closed this morning,” he said in an email. “I don’t know if we can close this week.”
