How a Government Shutdown Could Impact Your Home Buying Journey

Question: What does all this Washington drama have to do with me buying my house?

A government shutdown doesn’t stop home sales, but it can create serious delays in the mortgage process—especially if you’re using VA, USDA, or FHA loans. Knowing what to expect (and planning ahead) can help you avoid surprises.

VA Loans: Still Moving, Just Slower

If you’re using a VA loan, here’s the good news: these loans don’t stop just because the government does. Veterans and service members remain a priority. However, the process can slow down. Underwriters, coordinators, and appraisers who work alongside the VA may not all be fully staffed. That means you should expect more back-and-forth, longer wait times, and possibly delayed checks. VA loans keep moving—just at a crawl instead of a sprint.

USDA Loans: Completely Frozen

If you’re buying in a rural area with USDA financing, brace yourself. USDA loans typically freeze during a shutdownbecause the staff needed to approve them are furloughed. That means no one is there to move your file forward until the government is funded again.

FHA & HUD: Slowed by Limited Staffing

FHA loans do continue during a shutdown, but with fewer staff available, processing times stretch out. HUD offices also stay open, but with limited staff, so expect slower responses, services, and approvals across the board.

Conventional Loans: A Safer Bet

Here’s the bright spot: conventional loans through Fannie Mae and Freddie Mac aren’t tied directly to the government shutdown in the same way. These loans usually continue with little to no disruption, making them a steadier option if you’re concerned about delays.

Flood Insurance: An Overlooked Delay

Here’s a curveball most buyers don’t anticipate: flood insurance. If the home you’re buying requires coverage through the National Flood Insurance Program (NFIP), a shutdown can prevent new policies or renewals from being issued. That can delay closings for anyone buying in certain areas.

What This Means for Your Home Purchase

A government shutdown doesn’t mean real estate comes to a halt. Buyers still close, and people still move into their homes. But depending on your loan type, you could experience serious delays—sometimes weeks or longer.

If you’re already in the process, talk to your lender right away. Ask which parts of your loan depend on federal agencies like the IRS, USDA, or HUD. If alternatives exist—like using different income verification methods or switching loan programs—discuss those options early.

If you’re just starting your home search, be proactive. Gather your paperwork in advance, and build in extra time for the process. A quick close might not be realistic until funding resumes.

Yes, Washington drama can affect your home buying journey—not always in obvious ways, but definitely in ways that impact your timeline and stress level. The key is to stay prepared, stay flexible, and stay in close contact with your lender. That way, even in the middle of a shutdown, you can keep moving forward toward your new home.

Ready to Move Forward?

If you’re planning to buy a home soon, let’s talk through your financing options and build a strategy that works—even in unpredictable times. Reach out today to start the conversation and make sure you’re positioned to succeed.