Government Shutdown Update: What It Means for Mortgages (and Your Home Loan)

A quick update on how the government shutdown is affecting the mortgage world — and what it could mean for your loan process.

Let’s break it down:

🌀 National Flood Insurance Program (NFIP)

The National Flood Insurance Program is currently paused. That means if the home you’re buying is in a FEMA-designated flood zone, new flood insurance policies can’t be issued right now. This could stall closings unless your lender accepts eligible private flood insurance instead.Pro tip: Before making an offer, check whether the property is in a flood zone. It’s an easy step that can save you major headaches later.

🌾 USDA Loans

USDA loans are facing delays. Some files that already have commitments may still close, but new loan guarantees are on hold for now. If you’re using USDA financing, it’s best to plan for extra time and stay in close contact with your lender.

🏠 FHA and VA Loans

The good news: FHA and VA programs remain open. The challenge: they’re operating with limited staff, so certain certifications or case number assignments could take longer than usual.We haven’t seen delays yet, but it’s something to keep on your radar — especially if your closing date is coming up soon.

🧾 IRS Tax Transcripts

Many lenders require IRS tax transcripts to verify income. During the shutdown, these requests can be delayed, which could impact closings that depend on them.

💼 Federal & Military Pay

If the shutdown extends through October, some federal and military workers may miss paychecks. Most mortgage programs require current paystubs for qualification, so missing income can cause issues with loan approvals.If you think you might be affected, reach out to your lender now. We can strategize and adjust timelines to keep things on track.

The Bottom Line

This situation is evolving, but the key takeaway is to build in extra time and keep contingency dates flexible.If you’re currently in contract — or about to be — don’t panic. Message me, and I’ll walk you through your options and help you navigate the best path to keep your closing on schedule.