What does the government shut down mean for your home search or sale?

Yes, it has come to pass that Congress has failed to approve a Continuing Resolution (BUDGET TO OPERATE) providing funding for most government operations. So, the first thing I'll recommend here, is that you go to your representatives websites and message them that you want this resolved ASAP. I keep seeing reports that the American public wants this, but I can't find anyone that says that! My recommendation to my congressmen is that they become volunteers accepting no pay or benefits for the days the government is shut down and do so in goodwill to show the American people that they work for them.  My guess is with no pay our congressmen/women would quickly end this travesty of a government shut down.

So if you are buying or selling a home right now, how does this impact you?
From the reports I'm reading, including one I've included below for your review, the government shutdown will not stop the processing of single family home loans, BUT (there is always a but right?) you should expect the process to move more slowly and plan accordingly. To avoid the stress of asking for an extension to close on your home, and most likely due to cause and effect, causing stress for the seller because they now have to ask for an extension on their next home purchase, make sure you are planning on a longer period of time to close from the beginning. Instead of 30 days to close in your contract, you'll want to have in 45 or 60 days to close. If you can close sooner, everyone is usually happy about that and this is a less stressful issue to resolve. So for now, we are hoping the housing market will not be significantly impacted by the gov shutdown. I'll post new information as it comes out.


So many government programs, including some that impact federal housing and mortgage programs, have been suspended or slowed due to the lapse in government funding. The information I am sharing comes from the National Association of Realtors staff review of agency agency contingency plans for the current shutdown and past experience with previous shutdowns and near-shutdowns.

From the NAR:
Federal Housing Administration
HUD’s Contingency Plan states that FHA will endorse new loans in the Single Family Mortgage Loan Program, but it will not make new commitments in the Multi-family Program during the shutdown. FHA will maintain operational activities including paying claims and collecting premiums. Management & Marketing (M&M) Contractors managing the REO portfolio can continue to operate. You can expect some delays with FHA processing.
VA Loan Guaranty Program
Lenders will continue to process and guaranty mortgages through the Loan Guaranty program in the event of a government shutdown. Expect some delays during the shutdown.
Flood Insurance
The Federal Emergency Management Agency (FEMA) confirmed that the National Flood Insurance Program (NFIP) will not be impacted by a government shutdown, since NFIP is funded by premiums and not tax dollars. Changes to the flood insurance program scheduled to take effect on Oct. 1 will be implemented as scheduled.
Rural Housing Programs
For the U.S. Department of Agriculture programs, essential personnel working during a shutdown do not include field office staff who typically issue conditional commitments, loan note guarantees, and modification approvals. Thus, lenders will not receive approvals during the shutdown. If the lender has already received a conditional commitment from the Rural Development office, then the lender may proceed to close those loans during the shutdown. A conditional commitment, which is good for 90 days, is given to a lender once a USDA Underwriter approves the loan. If a commitment was already issued, the funds were already set aside and the lender may close the loan at its leisure. If Rural Development has not issued a conditional commitment, the lender must wait until funding legislation is enacted before closing a loan.
It is important to note that the traditional definition of “rural” for qualifying communities for assistance will be continued in effect during the shutdown.  We expect that language to continue the current definition will be included in whatever funding measure is eventually enacted.
Government Sponsored Enterprises
Fannie Mae and Freddie Mac will continue operating normally, as will their regulator, the Federal Housing Finance Agency, since they are not reliant on appropriated funds.
Treasury
The Making Home Affordable program, including HAMP and HAFA, will not be affected as the program is funded through the Emergency Economic Stabilization Act which is mandatory spending not discretionary.

IF YOU HAVE QUESTIONS ABOUT SELLING YOUR HOME, BUYING OR BUILDING A NEW ONE, DON'T HESITATE TO CALL, TEXT OR EMAIL ME. 614-657-2005

My promise to my clients: I try to always remember what it is like to walk into this incredibly complex world of buying and selling with little or no knowledge of how the process works. I know that behind the door of your home and in your life there is much more going on than just your real estate transaction. I work with each person, not the house, and with the whole person, not just the issues surrounding the transaction. When I attempt to put myself in your shoes and contemplate what you are dealing with I am most effective.

The Benadum & Bumpus Team

Amy Bumpus

Straight Talk—Always

614-657-2005