Spending authority for most of government expired midnight Septermber 30, 2013 causing many offices and programs of the federal government to shut down.
This means many government programs, including some that impact housing and mortgage programs may be affected, either suspended or slowed due to the lapse in funding. The FHA (Federal Housing Administration) participates in providing mortgage financing for nearly 15 percent of home purchases nationally. Its Office of Single Family Housing will endorse new loans under current multi-years appropriation authority in order to support the health and stability of the U.S. mortgage market.
New applications through the FHA may be impacted if there are requirements for lender information from the Internal Revenue Service. Otherwise local lenders seem cautiously positive about the availability of government loan guarantees and their important role in the financing of single family homes.
Realtors report that the overall uncertainty created by the interruption of government services is not positive for the general mood of consumers. On a national level there has been a general decline in mortgage loan demand which has been significant enough to cause mortgage interest rates to soften. Most, however, are confident that this interruption will be over shortly and at the very least might provide a lower monthly mortgage payment for those who are currently entering contracts to buy homes!