Mortgage, Rental Aid Arrives for Unpaid Federal Workers

January 23, 2019

As the longest federal government shutdown in history drags on, more than 800,000 government workers and an estimated 4.1 million federal contractors--who have gone without paychecks for weeks--will soon face their first mortgage or rental payment come due. As of Wednesday, the partial government shutdown has stretched 33 days and counting. Government workers are now facing their second missed paycheck. Many lenders and property management firms are stepping in with help for unpaid federal workers.

Several of the nation’s largest lenders—Wells Fargo, Quicken Loans, and Bank of America--are willing to waive late fees, set up special repayment plans, or even offer short-term loans to those employees affected by the shutdown.

Two shadowed hands reaching out to each other

Akshay Paatil - Unsplash

But to take advantage, government employees need to take the first step: Contact their lender or landlord immediately.

“The response has been comparable to the days following a natural disaster, where lenders are proactively announcing that they will work with affected borrowers,” says Greg McBride, chief financial analyst for Bankrate. “That can be everything from offering to waive fees on late payments to more customized solutions. But lenders may not necessarily know who is being affected by the government shutdown versus someone who is just late on their mortgage. That is why it’s so important that those affected proactively reach out before their payment is due or before they miss a payment. The sooner they do that, the more options that will be available.”

The U.S. Office of Personnel Management has released guidelines and sample letters for federal workers to use when contacting their lenders or landlords and document any discussed workout solutions. You can view the letter templates under “Sample Letters for Creditors and Mortgage Companies” at

Help Rushes In as Savings Shrink

Twenty-three percent of Americans have no emergency savings, according to a consumer survey. Federal workers who are not receiving paychecks have $249 million in mortgage payments and $189 million in rent payments due this month, according to data from the online real estate firm Zillow.

Unpaid workers who do not meet their financial obligations can add hundreds of dollars in overdrafts and late fees and have any delinquencies reported to the credit agencies; they could also face auto repossession or even foreclosure. Many banks are stepping in to waive late fees. For example, Wells Fargo announced it will automatically reverse and waive late fees on credit accounts, such as for home mortgage and home equity loans, for those government workers affected by the shutdown.

Banks want to avoid mortgage delinquencies from piling up during the shutdown. Several credit unions, like Navy Federal Credit Union and the U.S. Employees Credit Union, are offering zero-percent interest loans to help workers pay their bills, including their mortgage, regardless of the applicant’s credit score. In Colorado, Alpine Bank and others have earmarked $5 million to help furloughed workers with interest-free loans that they can receive the same day they apply. Provident Bank in New Jersey says it will allow government workers to break their certificates of deposit early without penalty.

On a national scale, Bank of America announced last week that it had been proactively reaching out to its clients who had been affected by the government shutdown to share news about its Client Assistance Program. The bank has set up a special phone line for clients, 844-219-0690, to receive financial assistance. The bank does not have a specific wide-scale program but is making help available based on personal circumstances.

“We’re closely monitoring the situation as it evolves,” Lawrence Grayson, Bank of America spokesperson, said in a statement. “And we will work with our clients on a case-by-case basis to help address their financial needs.”

On Tuesday, Homesnap announced it will pay the rent and mortgage of 10 government workers or contractors who have been affected by the shutdown. Its social media campaign asks government workers to share what their home means to them with #MyHomeMeans and #ShutdownStories. Homesnap will select 10 submissions at random and pay their rent or mortgage for February (regardless if the shutdown ends before the end of the month).

“We’re a D.C.-based company, and we’ve seen firsthand how the government shutdown has affected people across our region,” says Homesnap CEO John Mazur. “This is a small thing that we can do to help alleviate the stress and uncertainty that so many are feeling. We’re in the business of helping people find homes, so this seemed like a natural way for us to help.”

Rental Companies Step Up

The nation’s largest single-family rental owners—American Homes 4 Rent, FirstKey Homes, Front Yard Residential, Invitation Homes, Progress Residential, and Tricon American Homes—are offering unpaid federal workers the option to defer their rent payment with no late fees. The companies are part of the National Rental Home Council, a trade group of single-family rental home owners and operators. The members own more than 200,000 single-family rental homes across the country. Unpaid federal workers can apply for the rent deferral by showing verifiable proof that they are furloughed.

“Going without a paycheck for nearly a month can be an incredibly stressful experience for American working families,” says NRHC President Kevin Baldridge, the president of Tricon American Homes.

Airbnb, a short-term rental sharing company, is offering federal employees the chance to earn some extra money if they host their home through the site for three nights anytime over the next three months. Federal executive branch employees who do will get paid an extra night, up to $110. “We hope this boost will serve to supplement the income government employees already earn from home sharing, helping to address fast emerging financial challenges for the foreseeable future,” Airbnb said in a statement.

Bracing for Impact

President Donald Trump and the U.S. Congress continue to be stalled in budget negotiations to end the shutdown. Meanwhile, a ripple effect throughout the economy will eventually be felt, including even possibly through home sales--although it’s the unpaid workers that are feeling it the most right now, says McBride.

“There’s no denying the pronounced impact this is having on hundreds of thousands of households,” McBride says. “It’s not something that just gets wiped away as soon as these workers get their back pay either. Some are borrowing money with high interest rates or raiding their retirement account for funds. Once you take money out, it can be very difficult to get it back in.”

Major lenders and landlords across the country have offered assistance to furloughed government workers, including:

  • Bank of America
    Its Client Assistance Program will offer financial assistance and possible loan modifications, depending on the individual’s circumstance. Customers are encouraged to call 844-219-0690 for assistance or to set up an appointment.
  • Citibank
    The bank will make adjustments to fees and interest rates of affected customers. The bank may consider short-term forbearance and repayment plans and loan modifications. To talk to CitiMortgage, call 1-800-283-7918.
  • Freedom Mortgage
    The bank will evaluate a borrower’s personal situation and offer assistance based on individual circumstance, such as repayment plans, special payment forbearance and temporary partial payments, and late fee waivers. Call 855-690-5900.
  • Homesnap
    The real estate search portal will pay the rent and mortgage of 10 government workers or contractors who have been affected by the shutdown. To apply, workers need to post a photo, a video, or a few words that show what their home means to them on social media with the hashtags #MyHomeMeans and #ShutdownStories. You can also complete an online form. The deadline for submissions is Jan. 31. Homesnap will select 10 submissions at random and pay the government workers’ rent and mortgage for February.
  • JPMorgan Chase
    The bank is waiving or refunding late fees, extending payments on car loans and leases, and ensuring protection of customers’ credit histories. Those affected are urged to call its special hotline, 888-356-0023, or visit online.
  • Navy Federal Credit Union
    The credit union is offering a zero-percent APR loan of up to $6,000 for affected federal government workers and active duty Coast Guard members. You must already have an established direct deposit account to apply. Apply for its Government Shutdown Loan Program online.
  • Quicken Loans
    The lender is waiving all late fees for clients who may miss a mortgage payment due to the shutdown. Call 800-508-0944 or email
  • USAA
    The financial company is offering deferred payments on USAA credit cards and consumer loans, special payment arrangements with USAA Home and Auto insurance, and mortgage assistance payment programs. Visit its special page devoted to federal government worker assistance
  • U.S. Bank
    The bank is offering low-rate, short-term personal loans from $100 to $6,000 for federal employees in need of extra assistance. Any U.S. Bank customer with a mortgage, auto loan, or bank’s credit card can apply. The loans are being offered at a 0.01 percent APY on a 12-month term. Contact the bank’s designated federal government shutdown hotline at 877-760-6046.
  • Wells Fargo
    The bank will offer possible fee reversals and waivers to federal employees. It urges affected customers to call its hotline number, 800-219-9739, or visit its special government shutdown assistance webpage.