The government shutdown is wreaking havoc on a popular 0% down mortgage

Core Insights - The government shutdown has halted processing of USDA loans, affecting a $7 billion segment of the mortgage market, leaving many homebuyers and sellers in limbo [1][2] - Most mortgage lending types, including FHA and VA loans, continue as normal, but USDA loans are uniquely impacted due to additional processing requirements [1][5] Group 1: Impact on Homebuyers - Thousands of low- and middle-income homebuyers rely on USDA loans, which are designed to support affordable housing in rural areas [2] - The shutdown has caused significant delays, with homebuyers facing financial penalties, such as paying sellers for delays in closing [3][4] - The USDA's loan processing is on hold, affecting borrowers who need final reviews to meet strict eligibility requirements [5][6] Group 2: Employment and Processing Issues - Over 80% of employees in the division responsible for USDA loans are furloughed, leading to a significant slowdown in loan processing [6] - The remaining staff is limited to "certain limited activities" to preserve government property, further delaying loan approvals [6] Group 3: Homeownership Trends - Homeownership rates in rural areas have declined from 81% a decade ago to around 74% in 2023, reflecting broader economic challenges [6]