The Federal Housing Administration (FHA) said Wednesday it will continue processing claims during the government shutdown but cannot endorse new Home Equity Conversion Mortgages (HECMs) until funding is restored. That information was confirmed by the National Reverse Mortgage Lenders Association (NRMLA).

Because most reverse mortgages fall under the FHA’s HECM program, FHA loan endorsements stop as soon as funding lapses. U.S. Department of Housing and Urban Development‘s (HUD) contingency plan for a lapse in appropriations, updated on Sept. 29, outlined HECM protocol:

“The Office of Single Family Housing will endorse loans, with the exception of Home
Equity Conversion Mortgages (HECM) and Title I loans, under current multi-year
loan guarantee commitment authority in order to support the health and stability of
the U.S. mortgage market,” the plan reads.

In the document’s Q&A section, HUD confirmed that borrowers will receive HECM payments from HUD during the lapse in appropriations.

Bill Packer, chief operating officer of Longbridge Financial, siad the pause in FHA endorsements and the temporary delay in flood insurance policies will not affect the company’s ability to serve borrowers.

“We’re focused on educating our customers and partners about what this means, while reinforcing the alternatives available beyond FHA loans,” Packer said. “Our proprietary Platinum suite and the first-ever HELOC For Seniors provide innovative options that aren’t dependent on government funding. Our priority is ensuring customers have dependable choices and peace of mind, even during short-term policy disruptions.”

What a shutdown means for seniors

It is unclear how long a shutdown will be. Prolonged closures can weigh on housing, delay economic recovery and weaken investor confidence, according to Selma Hepp, chief economist at Cotality.

Beyond HECM delays, seniors could face other disruptions. Social Security checks will continue, but services at the Social Security Administration (SSA), like issuing new cards or processing applications, may be limited. Medicare, Medicaid and disability benefits will still be paid, though administrative delays and longer wait times are likely.

Borrowers who rely on federally backed mortgages — including FHA, Department of Veterans Affairs (VA) and USDA loans, which make up about a quarter of mortgage applications — may face significant processing delays as agency staff are furloughed. The USDA has already put new loans on hold and postponed scheduled closings.

Because the shutdown may block access to tax and Social Security records, Fannie Mae and Freddie Mac announced they are waiving some verification requirements for lenders. The guidance will last until government functions are restored.

Uncertainty also weighs on consumer and business behavior, Hepp said, as households hold off on major purchases and employers pause hiring or investment. Extended furloughs may hurt household finances, potentially damaging credit scores and tightening lending standards.

“If a shutdown drags on, missed payments or furloughs can hurt credit scores and loan performance, especially for federal workers and contractors. Stricter lending standards may shrink the pool of qualified buyers even more,” Hepp added.

A shutdown can also affect the Federal Reserve’s decision-making. Investors often drive down Treasury yields during government closures, which can trim mortgage rates by 0.125 to 0.25 percentage points.

Hepp noted in her commentary that the loss of critical data — such as jobs and inflation reports — makes it harder for the Fed to set policy. Without those benchmarks, the central bank may delay adjusting rates, rely on private-sector data or lean on internal forecasts, potentially heightening market volatility.

Analysis by Danielle Collis
Reporting by David Bonaddio

With its biggest buyer out of the picture, The Block is heading for its most nailbiting finale in 21 seasons.

As a former TV producer, I’ve sat through countless dramatic reveals and finales and seen plenty of scheming behind the scenes.

But this year’s cliffhanger isn’t about stolen blueprints or builders walking off set — it’s about whether anyone will actually buy the homes.
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For several seasons, entrepreneur and LMCT+ founder Adrian Portelli was The Block’s golden boy.

He became the show’s unofficial safety net, swooping in at the last minute to purchase properties for his luxury giveaway business LMCT+.

Producers could sleep easy knowing auction day wouldn’t end in disaster.

But now? Portelli has crossed over to rival Channel 7.

Earlier this year, he purchased two suburban homes in Melbourne’s Bulleen through his company Xclusive Tech Pty Ltd and donated them to Channel 7’s My Reno Rules series.

The $2.7m purchase and donation make his future with The Block unclear.

If he is contractually bound to Channel 7, it’s unlikely he’ll be back at Nine’s auction finale on October 25.

That leaves this season’s five Daylesford homes — each with price guides north of $3m — heading to auction with no guaranteed saviour.

Block co-creator and executive producer Julian Cress told the Herald Sun the stakes have rarely felt higher, but the format remains strong.

“Every season is a gamble, but the more risks we take, the longer we stay on air,” Mr Cress said.

“This year’s identical-footprint builds captured imaginations and proved just as tough as any reno season — maybe tougher.”

Nine’s head of content Adrian Swift said moving away from pure renovations had been a risk but one that delivered fresh energy.

“Renovating is the show’s DNA, but by overlaying identical floorplans we could show how every choice — tiling, planning, layout — completely transformed a house.

“That freshness is survival.”

Mr Cress said his nerves aren’t for the ratings but for the contestants.

“They didn’t sign up just to make television, they came to make money, he said.

Mr Swift agreed the auctions were always the great unknown.
“Sometimes the most deserving couples get little, others get millions, what matters is that they walk away with life-changing results.”

Block judge and Whitefox founder Marty Fox said Portelli’s absence could reset the dynamic.
“That’s the joy of auctions, they’re unpredictable,” Mr Fox said.
“You never know who’s going to show up, how the energy will shift, or who will bid.

“That element of the unknown is what makes auction day one of the most exciting moments of the whole season.”
Mr Fox said the homes would likely appeal to “buyers with a certain net worth, people who’ve built successful businesses, had overnight wins, or need tax-effective investment opportunities.

“The tax breaks that come with new builds make them attractive as investments as well as lifestyle plays,” he said.

Portelli’s presence in recent years has masked just how fragile The Block auction process has always been.

In 2024 he bought all five homes for about $15m, with even the lowest contestant profit at $650,000.

But before Portelli, The Block’s history was littered with pass-ins and bargains struck post-show. Between 2003 and 2010, contestants were lucky to walk away with tens of thousands.

Even in 2022, Omar and Oz smashed the all-time sale record with $5.586m, but three of the four houses failed to sell under the hammer.

And in recent years, Block homes have developed a reputation for bleeding value fast.

Once cameras stop rolling, builders often move in for weeks to patch defects and polish finishes left behind by contestants.

Savvy buyers know many of those fixes are only cosmetic.

Mr Cress said what keeps the show resonant is not headline bidders, but its contestants.
“The stars are everyday Aussies,” he said.

“People don’t want their autographs, they want to pat them on the back and say how proud they are.”
So what happens now that Portelli is out? Homes may be passed in, savvy locals may swoop for bargains, or new bidders may emerge.

But if not, this could be The Block’s biggest cliffhanger yet.

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david.bonaddio@news.com.au

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For generations, the American Dream was synonymous with homeownership — a white picket fence, a backyard and the pride of owning a place to call your own. But today, that dream is undergoing a quiet transformation. With the national median home price now exceeding $426,000, according to NAR, the goal for many Americans has shifted from the dream of owning a home to finding shelter they can afford. It’s time to look at innovative homeownership alternatives.

The myth of interest rates

While interest rates dominate headlines, they’re just one piece of a much larger puzzle. Much of the public discourse around housing affordability centers on interest rates. The Federal Reserve’s decisions dominate headlines, and many believe that lower rates are the silver bullet to unlock homeownership for first-time buyers. But that’s a fallacy. While rate reductions can stimulate the economy and encourage refinancing, they alone won’t solve the affordability crisis.

Home prices have surged in recent years — some markets seeing double-digit increases annually. Property taxes, which typically lag behind price hikes, are now catching up (and will continue to do so for the next 12 months), adding another layer of cost. Even when rates dipped earlier this year, the rally was short-lived. By mid-summer, sellers who expected a buying frenzy were forced to lower prices week after week. The market overheated, and buyers—facing sticker shock and stagnant wages—began pulling back.

The reality of affordability

Let’s break it down. If you want to buy a typical home priced at $426,000, you’d need to earn around $105,500 a year and have about $85,000 saved for a down payment, not including moving costs or closing fees. Sure, there are lower down payment options, but they come with higher monthly payments and require an even higher income — around $127,800. That’s a tough hurdle for many first-time buyers.

Even if interest rates go down, it doesn’t automatically make homes more affordable. Lower rates might encourage more people to buy, which can push prices even higher. For example, if rates drop by 1.5%, but home prices go up 10%, your monthly payment would only shrink by about $60—not enough to make a big difference. Additionally, that 10% price jump would also raise the down payment by more than $8,500, while increasing property taxes and homeowner’s insurance—both now and in the future—adding even more pressure to a new homeowner’s monthly budget.

Bottom line: lower interest rates alone won’t fix the affordability problem. These numbers show how hard it’s become to buy a home—and how many people are being forced to delay major life plans because of it.

Even a modest 5% rise in home prices would require a 0.83-point drop in interest rates just to preserve current affordability — underscoring how quickly small price increases can erode the advantages of lower borrowing costs.

Rethinking the dream

So where do we go from here? If we’re not heading toward a market correction or another default crisis like 2007–2016, we need to rethink what homeownership looks like. If traditional homeownership is out of reach, it’s time to redefine what “home” means.

Practical steps forward:

1. Redefine the starter home: Multifamily units, including condominiums or townhouses, and row homes offer a more affordable entry point and can serve as a new, more sustainable model for first-time buyers.
2. Embrace flexible financing: Hybrid adjustable-rate mortgages and balloon loans can reduce initial payments, making ownership more accessible.

Innovative alternatives:

1. Shared equity models: These allow buyers to pay only a portion of the purchase price, sharing ownership with investors.
2. Creative amortization structures: New financing tools can ease the burden of upfront costs and monthly payments.

A call to action

Interest rates are just one piece of a complex puzzle. If we want the next generation to build wealth through homeownership, we need to think bigger, collaborate smarter, and innovate beyond tradition.

The American Dream isn’t dead — it’s evolving. Let’s reimagine it together, so future generations can build wealth, stability, and community through new paths to homeownership.

John Bordon has built a distinguished four-decade career in mortgage banking, leading transformation and innovation across the full mortgage lifecycle — from origination and post-closing to servicing and default management.

This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.

To contact the editor responsible for this piece: tracey@hwmedia.com

West Capital Lending said on Thursday that it has entered into a strategic partnership with Mortgage Connections, a Michigan-based mortgage brokerage.

Mortgage Connections, founded by Ali Younes & Joe Dakroub Esq., has closed more than 843 transactions and $239 million in funded loan volume over the last 14 months, according to data from MMI. The company’s production includes more than $88 million in purchase transactions, $137 million in refinances and $11 million in HELOC volume.

“This partnership with West Capital Lending is about equipping our bankers with world-class tools and resources so they can deliver truly personalized mortgage solutions to clients across the country,” Younes and Dakroub said in a joint statement. “At Mortgage Connections, we’ve built our reputation by forming deep, lifelong relationships with Realtors and clients. Partnering with West Capital allows us to preserve that identity even as we extend our reach well beyond Michigan, bringing that same high-touch, values-driven approach to new markets.”

The partnership supports West Capital Lending’s national expansion strategy and deepens its footprint in the Midwest. West Capital, recognized as the number one broker partner of Rocket Mortgage and a top-three brokerage nationally by funded volume, recently surpassed 1,000 loan officers nationwide, according to a release from the company.

“Mortgage Connections represents exactly the kind of partner we want at West Capital,” said Matthew Blackmer, vice president of business development at West Capital Lending. “They are entrepreneurial, community-driven, and fiercely committed to client service. Together, we are strengthening our foundation in Michigan while accelerating our growth across the country. This partnership not only adds scale but reinforces our shared culture of innovation and leadership.”

The partnership announcement follows West Capital Lending’s recent announcement of adding Giorgio Bertoul to the team as president of sales. Bertorul will focus on optimizing the national sales organization and developing sales leaders across several regions.

Fair Isaac Corp.’s (FICO) decision to let resellers calculate and distribute its scores directly to lenders drew a mixed response from the mortgage industry — viewed by some as a step toward more competition, but by others as a potential driver of higher credit score costs in the short term.

On Wednesday, FICO unveiled the program, which bypasses the three nationwide credit bureaus (Equifax, TransUnion and Experian) by distributing scores directly to credit reporting agencies (CRAs).

​​The move comes amid heightened competition with VantageScore, owned by the three bureaus, whose VantageScore 4.0 will soon be eligible for use in loans purchased by Fannie Mae and Freddie Mac as an alternative to the Classic FICO score.

Federal Housing Finance Agency (FHFA) Director Bill Pulte posted Thursday morning on X a comment saying he “genuinely appreciates FICO taking constructive criticism” after conversations with CEO Will Lansing. 

“While their decision is a first step, it is appreciated. I encourage the credit bureaus to also take similar creative and constructive actions to make our markets safer, stronger and more competitive,” Pulte wrote. “To that end, VantageScore should also look at ensuring they are competitive, in every way, including but not limited to costs.” 

VantageScore declined to comment.

The two models 

FICO will offer lenders two pricing options. Under the “performance model,” lenders pay a $4.95 royalty fee per score plus a $33 fee per borrower per score on funded loans — a structure suited for lenders with high fallout rates. The traditional model remains unchanged at $10 per score through tri-merge resellers, consistent with previous pricing. 

Lenders may also continue working directly with the credit bureaus if they choose. Some sources said it is not yet clear what factors will guide lenders’ choice for the resellers or the bureaus in score calculation while others mentioned only pricing. The rationale behind the change, they added, is that more players in the chain will hold each other accountable for pricing.

Mortgage executives said the shift effectively redirects some revenue away from the bureaus by making resellers direct clients of FICO. However, because the bureaus still control essential credit data — including tradeline history — sources warned they may raise fees to offset the lost revenue.

Currently, FICO charges the bureaus $4.95 per score, which the bureaus often double before passing the cost along to resellers, the sources added.

Shelley Leonard, president of Xactus, said resellers remain heavily dependent on the credit bureaus for access to accurate consumer-level credit data, which will not change. Getting borrower data requires scale and is challenging to replicate, so the move does not disintermediate the bureaus in any way.

Today, credit bureaus take consumer data, run it through their technology integrations with FICO’s algorithmic score models, and generate a consolidated file of credit data. Resellers then compile that into a tri-merge credit report. Under the new program, the inputs and outputs remain the same — only the score calculation can shift to resellers.

Leonard said resellers are still waiting to hear what the bureaus’ pricing will be in 2026.

Market reactions 

Mortgage Bankers Association (MBA) president and CEO Bob Broeksmit said the new program enhances transparency and provides more options to lenders. However, “it remains to be seen if this will result in materially lower costs.” 

“MBA will monitor the implementation of this new program while continuing to call for reforms that support a better credit reporting system that promotes more competition, efficiency, and lower costs for consumers,” Broeksmit said in a statement.

The Community Home Lenders of America (CHLA) said it is “concerned that in a head-to- head matchup, Fair Isaac might ultimately squeeze out VantageScore and the Credit Bureau model altogether.”  

“We will closely monitor developments related to yesterday’s announcement, to ensure promised savings are real, passed through to consumers, and consistent with our long-standing calls for fair, competitive credit-score markets,” the CHLA said in a statement. 

FICO said it is already working with resellers to roll out the new options. Some resellers operate their own technology platforms that would be integrated with FICO, while others rely on third-party vendors.

Leonard of Xactus said the company already has integrations in place with the bureaus to receive credit data and will use the same connectivity for FICO’s integration. While Xactus has not committed to a delivery date, its goal is to be ready by January 1, when FICO says the program takes effect.

FICO scores are used by 90% of the top U.S. lenders. The company said the changes align with “calls from policymakers and industry leaders to modernize credit infrastructure and promote affordability, liquidity and access in the $12 trillion U.S. mortgage industry.”