Federal Workers Paying Mortgage Affected By Shutdown

Federal Workers Paying Mortgage Payments Affected By Shutdown

Gustan Cho Associates are mortgage brokers licensed in 48 states

This BLOG On Federal Workers Paying Mortgage Payments Affected By Shutdown Was PUBLISHED On January 22nd, 2019

The government shutdown is passing the 30 day mark.

  • The government is calling this as a partial government shutdown where only 25% of the government is shutdown
  • However, over 800,000 federal employees are affected by this shutdown
  • There are many federal workers who are being affected by this shutdown which is the longest in U.S. History
  • Mortgage payments is by far the largest monthly bill for any homeowner
  • Federal Workers Payment Mortgage Payments Affected By Shutdown
  • This is affecting many families and no doubt many more in days, weeks, and  months to come
  • Many federal workers are contemplating on whether to purchase their medications or paying their mortgage payments
  • Over 800,000 federal workers are without a paycheck
  • Many have been scraping by for the past 4 weeks
  • Landlords expect their monthly rental checks from their tenants
  • Lenders expect their monthly mortgage payments from their borrowers

What seems to be a very simple solution by Republicans and Democrats is turning out to be a major political firestorm. 

Federal Workers Paying Mortgage Affected By Shutdown Can Have Devastating Consequences

This political game between Nancy Pelosi, Chuck Schumer, and the Democrats is affecting 800,000 federal employees. Pelosi and Schumer is not even trying to compromise with President Donald J. Trump’s negotiation offer to come to a resolution. President Trump is concerned with border security and budget for the Wall Border. Unfortunately, this border security issue is affecting 800,000 federal workers. This number includes 380,000 folks who are furloughed and 420,000 federal workers who is working without a salary.  On a recent report from real-estate website Zillow out of the employees who are homeowners, the total dollar amount of their monthly mortgage payments is $249 million monthly. Total monthly rental payments from federal employees amounts $189 million monthly. The total of homeowners mortgage payments and renters rental payments total $438 million dollars. Most hard working Americans do not have a hefty nest egg in savings. Most Americans live paycheck to paycheck. Most federal workers were not too worried about this partial government shutdown. This was because they endured prior shutdowns in years past. However, the longevity of this shutdown is becoming an issue.

Government Shutdown Was Never An Issue With Previous Shutdowns

Previous government shutdowns was never an issue to federal workers.

  • However, this partial shutdown is becoming to be a national disaster affecting 800,000 estimated workers and their families
  • Not receiving paychecks is adding stress to many federal workers and their jobs
  • It is often difficult to concentrate and focus on their work if they have financial stress
  • The single largest monthly expense for any worker is their mortgage and/or rental housing payments
  • Many people’s monthly housing payments is half of their monthly wages
  • Many parts of the country like many counties in California, housing payments can be over $3,500 per month
  • So one or two missed housing payments will definitely impact homeowners and/or renters where it is next to impossible to catch up
  • According to 2017 report by employment site CareerBuilder, over 80% of Americans are living paycheck to paycheck

Most Americans do not have any savings or reserves in case of an emergency to cover even one month’s bills.

How Government Shutdown Affecting Federal Workers Under Purchase Contracts And Escrow

HUD, the parent of FHA, is one of the federal agencies affected by the shutdown.

  • FHA is technically closed but is operating with limited resources and staff
  • This shutdown is affecting not just FHA Loans but USDA Loans is being affected the most
  • FHA Loans is one of the most popular loan programs in the United States
  • It is not just home buyers with FHA Loans that is being affected by this shutdown, but the delays in closing is also affecting sellers, attorneys, title companies, and real estate agents
  • Mortgage lenders are beginning to see the negative effects on revenues from this 2019 Partial Government Shutdown
  • HUD announced that with each day the government is partially closed, everyone should expect the negative impacts on homeowners and home buyers with their mortgage process

The whole housing and real estate markets are getting noticeably affected.

How Long Will Federal Workers Paying Mortgage Affected By Shutdown Last

The government should have been opened weeks ago. Nancy Pelosi, Chuck Schumer, and President Trump need to come to a compromise. It seems both sides do not want to budge and it is a power play. President Trump threatened that the shutdown can last weeks, months, or even many years. He does not seem to budge on opening the government without his $5 million budget for border security. Many devout loyal Trump Supporters are beginning to express anger towards President Trump. On the flip side, many Democrats are also beginning to express hate towards Pelosi and Schumer. This is politics at its worst. The folks suffering is our fellow Americans. If this shutdown continues, it will not just affect the housing market, but our economy due to the ripple effects of the housing markets.

This BLOG On Federal Workers Paying Mortgage Affected By Shutdown Was Written By Gustan Cho, National Managing Director at Gustan Cho Associates. NMLS 1657322

Contributing Associates Editors Of Federal Workers Paying Mortgage Affected By Shutdown Aritcle

Contributing Associates Editors of this article on Federal Workers Paying Mortgage Affected By Shutdown are:

  • Massimo Ressa Chief Executive Officer at Gustan Cho Associates
  • Michael Gracz National Sales Manager
  • Alex Carlucci Senior Vice President of Gustan Cho Associates

Contributing Assistant Editors on this blog on Federal Workers Paying Mortgage Affected By Shutdown is Maria Windham Senior Mortgage Advisor of Gustan Cho Associates

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