Short version: you can still buy a home with a VA loan during a shutdown, but a few gears grind slower. Here’s the no-fluff guide for military families and anyone using VA benefits in the San Antonio area.

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What’s actually shut down (and what isn’t)

• VA home loans are still being guaranteed. The Department of Veterans Affairs continues core loan operations during a shutdown – most VA staff remain working under its contingency plan. Expect some slowdowns in support functions (think: appraisals or Certificates of Eligibility), but the program stays open.
• FHA & HUD programs run at reduced capacity. FHA keeps endorsing most single-family loans (with carveouts), but actions that need staff review can take longer.
• USDA rural housing loans pause. New direct and guaranteed loans aren’t issued (with very narrow exceptions); closings without an issued guarantee proceed only at lender risk.
• Fannie Mae/Freddie Mac keep operating. The GSEs are not funded by annual appropriations and historically remain open; lenders may have flexibility on things like verifying federal employees’ employment after closing.

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The biggest practical snag: Flood insurance

If the National Flood Insurance Program (NFIP) lapses with the shutdown, new and renewal policies can’t be issued until Congress reauthorizes it. Existing policies remain in force; assignments from seller to buyer may still be possible, and private flood insurance can be an alternative. In flood-zone purchases requiring flood insurance, a lapse can delay or freeze closings.

San Antonio tip: We don’t need flood insurance on every deal, but if you’re shopping near mapped floodplains along the Medina or Leon Creek systems (or certain pockets on the Far West Side), plan ahead. Private flood quotes can bridge gaps when NFIP is paused.

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Will the IRS slow you down?

Some lenders pull tax transcripts (Form 4506-T) as part of underwriting. During past shutdowns, transcript processing stalled – which can delay certain loans.

For VA loans, the VA has explicitly said the lack of a 4506-T should not be the sole barrier to closing because VA doesn’t require it under standard income-verification guidelines.

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Employment verification & other underwriting wrinkles

If you (or your co-borrower) are a federal employee, lenders and the GSEs have playbooks to verify employment after closing (prior to loan delivery) when normal channels are disrupted.

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What this means for your timeline

• VA purchases: Most proceed, but bake in extra time for COEs, appraisals, and case-by-case lender conditions.
• Homes in flood zones: High risk of delay if NFIP is lapsed – line up private flood or a policy assignment early.
• USDA loans: Expect pauses on new commitments. If you’re on a USDA path, we’ll discuss backup routes (FHA/VA) if eligible.

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Special Scenario: What if you’re furloughed?

This is the question I’ve been getting nonstop from my military and federal employee clients: What if I’m furloughed while trying to buy a home?

Here’s what it looks like:

• If you’re under contract:
  • Lenders like Fannie Mae and Freddie Mac allow verification of employment after closing but before the loan is delivered. That means your deal can often still close, even if HR can’t pick up the phone during the shutdown.
  • VA loans continue to be guaranteed and processed, though slower. Closings don’t automatically stop because of a furlough.
• If you were pre-approved and shopping:
  • Your pre-approval is still valid, but lenders may hit pause at final approval if they can’t verify income or employment.
  • A furlough letter is your best friend here – it proves you’re still employed, just temporarily unpaid.
• IRS transcript hiccups: With the IRS out of service, some lenders can’t pull tax transcripts. VA guidelines, however, make this less of a roadblock compared to FHA or conventional buyers.

👉 Bottom line: A furlough doesn’t automatically derail your purchase. It just means more documentation, possibly an extension, and a little lender creativity.

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For my military buyers: how we keep your move on track

1. COE early, every time. We’ll pull/refresh your Certificate of Eligibility at the start and watch for hiccups if VA staffing is thin.
2. Appraisal head start. We order promptly and build cushion into option and financing timelines.
3. Flood insurance game plan. If your short list includes any flood-mapped properties, we’ll pre-shop private flood and confirm whether a seller’s NFIP policy can be assigned – so a lapse doesn’t blindside you.
4. Transcript workaround. If a lender can’t pull IRS transcripts, we’ll steer to VA-friendly underwriting that honors the VA’s 4506-T flexibility.
5. If you’re furloughed. We’ll prep your documentation so lenders see this as a temporary pause, not a red flag.

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Bigger-picture market effects (why this matters for pricing & negotiations)

Industry groups expect minor short-run impacts but warn a long shutdown could dent demand and slow closings – particularly where flood insurance is required and among loans reliant on agency staffing. NAR’s past surveys show most deals still close, but a noticeable share do get delayed or fall through due to uncertainty.

Translation: motivated buyers and well-priced homes still move; wobbly deals get wobbly faster.

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Bottom line (and your next move)

• Yes, you can still buy with VA. Plan for a little extra time.
• Flood-zone properties are the biggest risk during a shutdown – let’s de-risk early.
• If you’re furloughed, don’t panic. Documentation plus VA guidance can keep your file live.

Thinking about pulling the trigger while Congress plays budget Jenga? Let’s tailor a strategy to your exact loan type and target neighborhoods in 78254 and beyond. I’ll coordinate with your lender, get flood answers up front, and keep your PCS timeline on the rails – no sugar-coating, just solutions.

Sources & further reading

• National Association of REALTORS® — What a Government Shutdown Means for REALTORS® (Oct 1, 2025). VA guarantees continue; FHA reduced capacity; NFIP lapse implications; USDA pauses.
• National Association of Home Builders — How the Government Shutdown Will Affect Housing (Oct 1, 2025). Program-by-program impacts; NFIP details; IRS transcript issues.
• VA Contingency Planning (agency outlines continuity of operations; most VA services continue). U.S. Department of Veterans Affairs+1
• VA Lapse Plan FY2025–FY2026 (operational detail for shutdown scenarios). U.S. Department of Veterans Affairs
• VA Circular 26-23-17 (IRS 4506-T not required by VA; furlough documentation guidance). Benefits
• NFIP lapse coverage (what happens when NFIP authority expires; closings in flood zones impacted). AP News+2Congress.gov+2
• GSE guidance during shutdown (flexibilities for lenders). HousingWire