A government shutdown won’t immediately halt mortgages — Fannie Mae & Freddie Mac have policies in place to keep loans moving. Lenders can use flexible verification, furloughed workers can still close, and forbearance options exist.
But delays are real:
FHA, VA & USDA loans may see processing slowdowns or pauses.
USDA loans (common in rural areas) could stall entirely.
Flood insurance (NFIP) lapses could block closings in flood zones — affecting up to 40,000 sales per month.
If the shutdown drags on, borrowers will need to be prepared for a delayed closing.
Bottom line: conventional loans will continue, but government-backed loans and flood insurance closings face real risk of delay. Buyers, sellers, and lenders should prepare for uncertainty.