Title insurers feel the pinch in government shutdown
Stocks prices for Fidelity National Financial, the largest title insurer in the U.S., are slipping as the federal government shutdown drags on. The company fell 0.5 percent to $26.19 this afternoon, while the No. 2 seller of title insurance, First American Financial Corp., tumbled 1.2 percent to $24.16.
The hiccups are perhaps linked to closures at the Internal Revenue Service, Social Security Administration and Department of Housing and Urban Development. Federal workers who verify Social Security numbers and provide IRS tax records are a vital link in the approval process, and their absence could cause a delay, Bloomberg News reported.
“Title insurers are sensitive to macroeconomic factors such as employment levels, consumer sentiment, and interest rates and therefore the duration of the shutdown is a vital factor in determining its affect,” Fitch said in a statement. “The longer the government shutdown lasts, the bigger the potential profitability impact to title insurers.”
Would-be buyers attempting to secure mortgages backed by the Federal Housing Administration may also be stuck twiddling their thumbs, Bloomberg said.
Home builders are feeling the pain as well, with D.R. Horton, the country’s largest home builder by revenue, falling 2.8 percent to close at $18.54 today. [Bloomberg News] — Julie Strickland