If you’ve ever bought a home in a community with a homeowners association, you already know there can be a lot more to the transaction than simply finding the right house.HOA documents,
ðŸ›ï¸ Government Shutdowns & Mortgage Rates: What History Suggests
Dated: October 1 2025
Views: 219
Just when it seemed that mortgage rates would soften, US lawmakers have voted to shut down the government, leaving some potential home buyers to wonder if a shut down will affect mortgage interest rates. In increasing numbers, potential buyers are signaling readiness to get back into the housing market this year. But what about the interest rates on the mortgage loans?
Americans haven't experienced a government shutdown since during President Trump's first term, and that shutdown was by far the longest in recent history. Even then, reporting at the time and in years since suggests that the shut down itself was not a direct cause for a slight decrease in the interest rate. Other market forces already in play contributed more significantly.
It's true that a government shutdown introduces uncertainty into financial markets. Historically, shutdowns have sometimes pushed investors toward safer assets (like U.S. Treasuries), which can nudge yields, and thus mortgage rates, a bit lower. Mortgage Professional+3The Truth About Mortgage+3The Truth About Mortgage+3
However, the effect is modest and often short-lived. In some cases, fear of credit risk or disruption to federal operations could work the other way, pushing yields higher. Investopedia+2Housing Notes - By Jonathan Miller+2
Also, some mortgage-related agencies (e.g. FHA, VA, processing of tax records) may slow or experience delays, which could indirectly affect loan closings. But this doesn't affect the rates themselves. RISMedia+3Rocket Mortgage+3Coakley Realty+3
So, overall, while a shutdown may cause short-term volatility, it doesn’t reliably produce sustained changes in mortgage rates.
| Shutdown / Event | Observed Mortgage-Rate Movement | Notes / Sources |
|---|
| 1995–1996 (21-day shutdown) | 30-year fixed fell from ~7.15 % to ~7.02 % during that window | “What Happens to Mortgage Rates During a Government Shutdown?” The Truth About Mortgage |
| 2013 (16-day shutdown) | Mortgage applications dropped ~7 % in week two; rate effects muted | Senate JEC report quoting MBA data Joint Economic Committee |
| 2018–19 (35-day shutdown) | Some closings and agency delays, but solid long-term mortgage trajectory unaffected | HousingWire (“federal interruptions can stall mortgage closings”) HousingWire |
Are you ready to talk about buying a home this year in Colorado?
I know some great lenders who know the current and accurate interest rates like the back of their hand, and are ready to help you with your necessary preapproval!
Jamie DeBrosse
My name is Jamie DeBrosse and I am a REALTOR® in the Cherry Creek School district and surrounding cities. My real estate expertise is partnering with Denver, Colorado area home sellers to strategical....
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