Lender Letter LL-2025-03 Impact of Federal Government Shutdown
Temporary operational guidance to address loan eligibility and servicing during federal government shutdown affecting borrower employment verification and income documentation
Advisory Assessment
Impact. This Fannie Mae guidance addressed employment verification challenges during the October 2025 federal government shutdown, allowing servicers to document verbal verification attempts and accept alternative income documentation when standard federal employer verification was unavailable. The guidance automatically expired when government operations resumed, creating no ongoing compliance obligations for your institution.
Risk. Examination risk is minimal since this was temporary guidance that has already lapsed, but operations teams may retain outdated procedures or confusion about current employment verification standards. The primary exposure lies in staff applying shutdown-era accommodations to current loan processing when standard verification requirements have returned to normal.
Recommended Action. Operations should conduct a brief review of current employment verification procedures to confirm staff are following standard GSE guidelines rather than any residual shutdown accommodations. Compliance should verify that loan files from the October-November 2025 period properly document the basis for any alternative verification methods used during the shutdown.
Watch. Monitor for future government funding deadlines that could trigger similar operational guidance from Fannie Mae, and ensure your team has established protocols for quickly implementing temporary verification accommodations should another shutdown occur.
Classification
- Regulatory Program
- GSE Secondary Market
- Doc Type
- Guidance
- Effective Date
- 2025-10-01
- Days to Action
- -288
- Comment Deadline
- —
- Published
- 2025-10-01
Urgency Basis
Temporary guidance effective October 1, 2025 that has already expired by reference date of May 26, 2026. Document addresses past government shutdown with policies that automatically expire when government resumes operations.
Operational Context
Impact by Category
Key Requirements
Scoring Rationale
This is temporary guidance addressing a specific government shutdown scenario that occurred in 2025. The document provides procedural accommodations rather than permanent policy changes. Impact scores reflect the temporary nature and limited scope - primarily affecting employment verification processes and offering existing forbearance options to affected borrowers. All provisions automatically expire when government operations resume, making this historical guidance with no current compliance obligations.