We’re Here to Help with Home Finance

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Lenders and borrowers continue to be faced with a U.S. Government shutdown and not funding the government for FY 2026, which places a strain on every company involved in the housing market. This shutdown impacts both individuals seeking home financing and real estate professionals, such as brokers and realtors, who assist them in managing the purchase, sale, and rentals of properties. Federal agencies prepared for a government shutdown, and with good reason. Everyone is hopeful that Congress and the President will come to an agreement that starts the government back up again. Meanwhile, Orion’s management and AEs felt that our brokers deserved a reminder and summary of actual and potential real estate finance impacts that are actually occurring. For example, individuals may find it harder to manage personal finance activities like saving for a down payment or borrowing for a mortgage, affecting overall cash flow, while businesses may face delays in investing, managing capital, or overseeing profit and budgeting due to disruptions in the financial system.

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FHA, HUD, Fair Housing Act, and Ginnie Mae Operations During the Shutdown

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The operations of the Department of Housing and Urban Development (including FHA and Ginnie Mae) have been reduced considerably, which has impeded the processing and closing of mortgage loans and negatively impacted many business operations. HUD and FHA are responsible for overseeing properties located in various regions, including those for sale and rentals, and their operations are managed by authorized managers and can help to identify real estate professionals. The FHA Office of Single-Family Housing is continuing to promote new loans, with the exception of Home Equity Conversion Mortgages (HECM), Title I loans, and loan endorsements that require assessment by an FHA underwriter (i.e., non-direct endorsements). Other requests will only be handled on an emergency basis, or for the imminent threat to the safety of the residents, or to the protection of property in HUD-insured or assisted multifamily projects.

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Orion and other lenders have continued to have access to HUD systems, such as FHA Connection, as it will remain operational. However, actions that require HUD personnel to respond have been delayed or suspended. The same applies to lender inquiries submitted to FHA Resource Centers, which remain open to answer general questions, but responses requiring escalation are delayed and may be hard to explain. FHA will continue to pay partial claims in the event of a shutdown. Interest rates significantly affect mortgage payments and the overall finance of property affordability, which can further complicate financial planning during such disruptions.

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Ginnie Mae is largely unaffected by a shutdown, as it has a two-year MBS guarantee commitment authority that a lapse in appropriations will trigger with the approval of OMB. Ginnie Mae plays a key role in the financial system by guaranteeing mortgage-backed securities, in line with the fair housing act, which include bonds that are essential for investing and managing capital in the real estate finance industry. The Department of Veterans Affairs has continued to operate, but service levels are poor. The Agency is drawing on any available carryover balances from the previous year until those funds are exhausted. The profits of corporations provide tax revenue for the government, funding public goods and services.

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The U.S. Department of Agriculture (USDA) Rural Development has ceased operations, including most mortgage operations within the Single Family Housing Guaranteed Loan Program (SFHGLP), with the exception of functions approved by the Deputy Under Secretary for Rural Development to facilitate activities already in progress, such as (but not limited to) construction draws; review and processing of guaranteed loss claims; and actions necessary to support foreclosure sales. The programs affected include those supporting properties located in rural areas, and both sales and rentals of such properties may be delayed in terms of how realtors can effectively manage properties can sell.

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Agencies Continuing Financial System Operations

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For some good news, Fannie Mae, Freddie Mac, and the Federal Home Loan Banks (FHLBanks) are not directly affected, except to the extent that they rely on functions of other impacted agencies. These entities play a vital role within the broader financial system, managing investments and lending activities that support the housing market.

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The National Flood Insurance Program (NFIP) has ceased issuing new policies and renewals until the program is reauthorized by the appropriate federal authorities. Public finance and cash flow from tax revenue are essential for funding such programs, while effective management of money and government budgeting and spending decisions directly impact their operation and the resources available for disaster recovery.

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In recent years, the IRS’s Income Verification Express Service (IVES) and Revenue & Income Verification Service (RAIVS) have been classified as exempt activities under the Anti-Deficiency Act. Additionally, the Inflation Reduction Act provides supplemental appropriations to the IRS through September 30, 2031, ensuring that these services can continue even in the event of a lapse in appropriations. Accounting, tax, and legal compliance are critical for both individuals and businesses, and these services are managed by professionals with the ability to handle complex finance activities. Key activities in personal finance include budgeting, saving, investing, debt management, and tax and estate planning, which professionals may join to enhance.

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The Social Security Administration’s contingency plan does not explicitly mention Social Security number verification or the electronic Consent Based Social Security Number Verification (eCBSV) service. The plan broadly lists “benefit verifications” and “requests from third parties for queries” as discontinued activities during a funding lapse, which has left many stakeholders concerned. As a result, the SSA is not processing Social Security number verification requests during the current government shutdown. However, automation provided through the eCBSV system may help improve efficiency once operations resume. Government spending and public finance play a critical role in supporting social programs, and effective budgeting and forecasting remain essential for managing these obligations.

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Regardless of what the President and Congress are doing, Orion and our brokers recognize that people still want to achieve homeownership. Our Account Executives continue to provide exceptional service, competitive pricing, and valuable products to our clients. Orion remains committed to supporting its partners — including realtors and brokers — and is focused on covering all aspects of real estate finance, from personal and investment finance to corporate solutions. That commitment will continue, no matter the circumstances.

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