As the government shutdown drags into its fourth week with no end in sight, I wish I could lay out a path to compromise, but I can see none. Speaker Johnson hasn’t called the House into session all month, and has made clear he has no plan to do so. The Senate remains far from the 60 votes needed to pass a funding bill, having failed to bring the House’s short-term continuing resolution (CR) or any other funding measure to the floor for the 13th time by a vote of 54 to 45 as of Thursday afternoon.
The White House continues to leverage the shutdown to accelerate its efforts to eliminate large swaths of the government, including those established and required by law, like the Community Development Financial Institutions (CDFI) Fund. Over 100 Republican members of the Senate and House of Representatives are working to save the CDFI Fund.
A negotiated resolution to the shutdown remains far out of reach, given that the White House refuses to meet with Democrat leaders, and House of Representatives isn’t even in session, with no date certain to return. That being said, a bipartisan group of Senators has been meeting on a potential off-ramp, most recently with a lunch hosted by Senators Rand Paul (R-Ky.) and Gary Peters (D-Mich.). Given the politics of where we are, this is unlikely to change anytime soon. Senate Majority Leader Charles Shumer and House Minority Leader Hakeem Jeffries will face severe backlash if they capitulate to President Trump and agree to a clean CR without broad support in their party, which does not exist. Speaker Johnson is similarly tied to the President’s position. And Senate Majority Leader Thune doesn’t have the votes to move a bill, even he wanted to. President Trump is also headed to Asia on a several-day-long visit, which will delay any potential negotiations.
While the impact of the shutdown in October has been limited to partial paychecks and significant delays in funding across the board, November presents a new and much starker set of challenges. The October 24 paycheck was not paid, so Federal employees will be facing their November rent, mortgage, and other bill deadlines short of cash. Disbursements of Federal funds that were made in October will largely come to a halt in November. And the reality of a prolonged shutdown will begin to impact the economy.
NHC members should hope for the best, but be prepared for the shutdown to last through the end of the year. Dramatic price increases to Obamacare costs will be apparent on November 1, and that could spur movement, but those costs won’t hit paychecks until January. While no one knows how long the shutdown will last, odds on the prediction blockchain website Polymarket on Sunday, October 26, put the chance of it lasting through January at over 90%!
What does this mean for housers, renters, and homeowners throughout the country? An update of where we stand follows. NHC will continue to communicate with our members and stakeholders as the shutdown continues. You can keep up with the latest developments at the Housing Resource Center at www.hrc.nhc.org.
Below is a synopsis of the how the shutdown is impacting individuals, programs and recipients as we currently understand.
Federal Employees
Federal employees who haven’t had a paycheck in a month will begin to struggle with their budgets. Communication is the most important tool. Creditors can’t help you if they don’t hear from you. Without communication, they will always assume the worst case scenario.
- Paying your mortgage or rent first is always a good idea because it has a disproportionate impact on your credit rating, and because of its size it’s the hardest payment to catch up on. If you cannot make your payment on time, immediately contact your mortgage lender or landlord. Let them know about your situation and request assistance or flexibility. Open and early communication is essential.
- Families in HUD or USDA-assisted housing, or receiving rental assistance through HUD or USDA programs, will continue to have their rental payments covered through November, according to the National Low Income Housing Coalition.
- Navy Federal Credit Union’s Paycheck Assistance Programoffers a 0% APR loan to eligible federal employees or contractors impacted by the shutdown. They can receive a loan amount based on their monthly pay.
- The Congressional Federal Credit Unionis offering a suite of “stability assistance programs,” which includes “furlough solutions,” a 0% APR relief line of credit during a 60-day period, and then 4% after with fixed monthly payments for 36 months. They also offer deferred payments on loans, transition loans, and other services.
- PenFed Credit Unionis also offering furlough assistance during the shutdown. This includes no interest loans equal to your payroll direct deposit, skipping a payment, and home loan hardship assistance including deferring payments, forbearance plans, loan modifications, and more.
- For households who cannot pay their mortgage, Fannie Maeand Freddie Mac have directed servicers to assist borrowers affected by the shutdown, reminding them that they are authorized to offer forbearance plans when needed.
- For borrowers closing on a mortgage and home purchase during a shutdown, both Fannie Mae and Freddie Mac offer certain exemptions related to employment verification if lenders are unable to receive verification due to the shutdown.
HUD Programs
The Department of Housing and Urban Development (HUD) continued to pay rents for Housing Choice Voucher and Project-Based Section 8 households through November, but funding for December is uncertain. If the shutdown persists, these programs may run out of obligated funds, interrupting payments to landlords and public housing authorities. Property owners reliant on Section 8 or Rural Development (RD) rents would need to draw on reserves, creating stress for smaller landlords and nonprofit housing operators. New voucher issuances and recertifications may be paused, and fair housing enforcement activity has been severely curtailed.
HUD’s limited staffing—already reduced by attrition and now further constrained by furloughs—means grant disbursements, monitoring, and technical assistance are delayed across all programs, including Community Development Block Grants (CDBG), HOME Investment Partnerships Program (HOME), and Continuum of Care (CoC) homelessness assistance.
- HUD will keep IT systems including Enterprise Voucher Management System (eVMS), HUDCAPS, and Line of Credit Control System (LOCCS) open to disburse previously obligated Housing Assistance Payments (HAP), administrative fees, and operating/capital funds. HUD may intermittently recall staff to prevent termination of assistance or property risk; but it cautions monthly subsidy programs “can be at risk of running out of funding during a lapse.” Plan accordingly for November cash flow.
- REAC/NSPIRE inspections: If conducted by HUD employees, generally postponed unless there’s a known health or safety risk. Contracted inspections obligated before the lapse may proceed; HUD staff review is limited to exigent cases.
- Project-Based Rental Assistance: HUD can process payments/closings tied to prior commitments and may proceed with certain Rental Assistance Demonstration (RAD) closings scheduled before the lapse, particularly where failure to close threatens the property (e.g., tax credit deadlines).
- Recipients of Supplemental Nutrition Assistance Program (SNAP) benefits may see a cut or lapse in funding as soon as November, potentially impacting millions of households that often also reside in subsidized housing.
2) Community Planning & Development (CDBG/HOME/ESG)
- Drawdowns continue for already-obligated funds; eLOCCS/IDIS/DRGR stay available. If a draw requires HUD staff review, HUD may recall staff only to address imminent risk to life or property.
- Routine reviews, new awards, and plan/action-plan reviews largely pause (some consolidated plans could auto-approve during a prolonged shutdown).
- CPD Disaster Recovery Assistance Programs fall under excepted activities that will continue during a shutdown (though there may be delays). CDBG-DR consolidated plans are reviewed and approved during shutdowns unlike other CPD grantee consolidated plans.
- Section 108 debt service payments scheduled to trustees continue.
3) FHA / Ginnie Mae / GSEs
- Federal Housing Administration (FHA): Single-family and multifamily operations are trimmed to “excepted” functions; no new commitment authority during the lapse. Most loan endorsements may proceed if subject ti available commitment authority, excluding reverse mortgages and Title I; construction draws can proceed at lender/owner risk with limited oversight; change orders don’t get processed. Housing Counseling is largely shut down. Expect slower endorsements and manual actions.
- Ginnie Mae: Continues to issue commitment authority, pool/guarantee MBS, process monthly payments, and manage issuer defaults using no-year funds to avoid market disruption.
- Fannie Mae/Freddie Mac: The Enterprises are not government agencies and therefore do not shut down. Both issued temporary lender letters with flexibilities (e.g., handling IRS transcript delays in post-closing quality control windows).
Community Development and Local Governments
Local governments and nonprofits that rely on CDBG or HOME grants are beginning to exhaust existing balances. HUD policy allows some drawdowns without staff involvement, but where review or approval is required, requests may be “intermittently” processed only to prevent threats to life or property. The National League of Cities notes that many communities are already feeling the effects of the shutdown through slowing or halted social safety nets, reduced economic activity due to federal and military furloughs, and funding uncertainty.
U.S. Department of Agriculture Rural Development (USDA-RD) housing
- Single-family: Direct and guaranteed purchase loans generally pause (no new conditional commitments), halting zero-down rural deals; refinances face similar issues. Recent reporting confirms widespread freezes affecting rural homebuyers.
- Multifamily: Core servicing and some state office functions continue, but most actions needing federal staff review are delayed; Section 521 RA payments hinge on pre-obligated funds and limited staffing per USDA lapse plan.
Flood insurance (NFIP) & closings
- National Flood Insurance Program (NFIP) authorization has lapsed, so new and renewal federal flood policies can’t be issued; that stalls closings in special flood hazard areas that require flood insurance for government-backed or many conventional loans. Analyses put daily affected closings in the thousands.