It could have been a lot worse. But the big, bad government shutdown caused little more than a whimper as far as the mortgage industry is concerned. And since it might all happen again in a couple of months, we now have a template the mortgage agencies can reuse.

Fannie Mae and Freddie Mac remained open for business as they continued to take advantage of their dual identities as public/private entities. It’s simple. When the government shuts down, they put on their private company colors.

The Department of Veterans Affairs, which is always on the list of “essential” government agencies, kept its home loan guarantee program humming.

Perhaps the most surprising performance was turned in by the Federal Housing Administration. Hardly considered essential in most quarters and generally considered a basket case by its critics, FHA continued to insure single-family loans during the 16-day shutdown.

HUD officials decided that insuring loans was an essential function and kept FHA’s electronic insurance system up and running. FHA’s interface with the Social Security Administration was also working so FHA lenders could verify Social Security numbers.

So even with a skeleton crew, FHA continued to support lenders and the housing market.

Rural Housing Service lenders were not as fortunate. When the U.S. Department of Agriculture shut down, so did RHS. The agency even disabled its automated underwriting system, called GUS. All rural housing lending stopped. GUS is expected to become operational again on Oct. 21.

It seems the biggest hassle during the shutdown involved the Internal Revenue Service, which stopped processing 4506-T requests.

It’s mindboggling that lenders and investors would become unhinged because they couldn’t get an IRS transcript to verify the borrower’s income and other key tax return data. But after hundreds of billions of dollars of loan repurchases and settlements, the industry felt as if it had suddenly lost its security blanket.

Fortunately, the shock wore off fairly quickly. After a couple of days the big boys, like Wells Fargo and Chase, decided to waive the IRS transcript requirement. They instructed lenders to simply include a 4506-T form signed by the borrower in the loan file. Verification by the IRS could wait until the government reopened.

But some lenders refused to close loans without an IRS transcript and some investors stopped buying loans.

It may be wise for the industry to come up with an alternative to the IRS for verifying the borrower’s income. So the next time the IRS shuts down, lenders won’t have to worry about their backside.

Such a shutdown may come fairly soon. The budget truce between the Democrats and Republicans only lasts until Jan. 15. And both sides are galaxies apart when it comes to taxes and spending.

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