How the Government Shutdown Will Affect Appraisers
In this issue:
- Government Shutdown: The impact on appraisers
- 2026 Annual Conference: What Residential Appraisers Can Expect
- Still Time to Register: Commercial and Residential Liability Concerns
- Network and Learn: Chapter Conferences in Full Swing
Insights
Inside the 2026 Appraisal Institute Annual Conference: Learn, Grow, and Lead in Nashville
At the 2026 Appraisal Institute Annual Conference, appraisers can earn up to 14 hours of CE credit while gaining insights that go far beyond form changes and regulatory updates. The Residential track delivers everything from essential GSE and UAD/URAR updates to new business strategies, technology insights, and professional coaching designed to help appraisers build stronger, more resilient practices.
Three dedicated tracks—Residential, Commercial, and Business & Professional Development—make this year’s event a complete learning and leadership experience.
Government Shutdown: Appraisers Face Mixed Impacts Across Federal Housing and Lending Programs
The partial shutdown of the federal government is creating uneven impacts across the mortgage and housing landscape. While some loan programs continue operating, others have slowed or paused entirely—creating uncertainty for lenders, appraisers, and borrowers alike.
FHA: Operating on a Limited Basis
The Federal Housing Administration continues to endorse loans through its Direct Endorsement program, allowing lenders to process FHA-insured loans they underwrite themselves.
However, FHA has paused loans requiring direct FHA underwriter review, and will not endorse Title I property-improvement loans or Home Equity Conversion Mortgages (HECMs) during the shutdown.
The agency is still processing certain manual endorsement actions—including case number cancellations, reinstatements, transfers, and releases from hold queues (including condominiums)—but staffing limitations are expected to slow response times.
The FHA Resource Center remains available to answer questions, though responses that require HUD staff escalation may be delayed.
VA: “Business as Usual”
The Department of Veterans Affairs has assured appraisers and lenders that it’s “business as usual” during the shutdown. The VA’s Loan Guaranty program is continuing operations, and VA appraisal assignments are expected to proceed normally.
Still, some appraisers note that payment delays could arise if lenders or AMCs face internal disruptions.
USDA: Rural Housing Loans Paused
The U.S. Department of Agriculture has suspended new commitments under its Single-Family Housing Guaranteed Loan Program, effectively putting rural housing purchases on hold until funding resumes.
Loans that were already obligated before the shutdown may continue toward closing, but new guarantees will not be issued. The pause could delay purchase transactions in rural markets that depend on USDA financing.
NFIP: No New or Renewal Flood Policies
The National Flood Insurance Program (NFIP) cannot issue new or renewal flood insurance policies during the shutdown.
Existing policies remain in force, and claims are expected to be paid—though closing delays are likely in flood-prone areas where new coverage is required. Industry sources caution that a prolonged lapse could also affect the timing of claim payments.
Multifamily Lending: Some Closings Continue
For multifamily transactions, the impact varies by program:
- FHA Multifamily (MAP, 221(d)(4), 223(f), etc.) loans may close if a Firm Commitment was issued before the shutdown. No new commitments will be issued. Construction draws and escrow releases can occur at the lender’s risk, subject to post-review when HUD staff return.
- Section 8 and other rental assistance contracts are expected to continue while existing funds last, but could face delays if the shutdown extends.
- Fannie Mae and Freddie Mac multifamily programs continue normally, as they are not funded through annual appropriations.
- USDA Section 538 rural rental guarantees are on hold, consistent with other USDA programs.
IRS, Tax Court, and Federal Judiciary
The IRS will continue normal operations, drawing on Inflation Reduction Act funds that remain available through 2031. Filing and payment deadlines still apply, but taxpayer correspondence and audits could slow if the shutdown persists.
The U.S. Tax Court remains open, with its electronic filing system (DAWSON) fully operational.
The federal court system—including district, appeals, and bankruptcy courts—will remain open through mid-October, using existing fee balances and carryover funds. After that, courts may move to “essential operations only,” which could delay civil cases.
Land Acquisition and Easement Programs
Most discretionary land-acquisition and easement programs at the USDA and Department of the Interior are paused, since they depend on annual appropriations.
Projects funded by non-lapsed sources (such as mandatory Land and Water Conservation Fund dollars) may proceed, but federal reviews and closings are likely to be delayed due to furloughs.
Appraisers involved in NRCS easements, Forest Legacy, or Interior land transactions should expect schedule disruptions and limited federal support until full staffing resumes.
Practical Implications for Appraisers
- VA assignments should continue normally.
- FHA work may slow where federal staff involvement is required.
- USDA and NFIP-related transactions will likely stall until appropriations are restored.
- Multifamily and land easement appraisals could face documentation and payment delays tied to unavailable federal reviewers.
- Appraisers may also encounter cash-flow strain if clients—including AMCs or lenders—delay payments tied to affected programs.
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Appraiser Liability Trends: Litigation Risks for Commercial and Residential Appraisers
The Appraisal Institute is proud to present this webinar in partnership with Liability Insurance Administrators (LIA) - the only Errors & Omissions program endorsed by the Appraisal Institute since 1991, and the largest program in the U.S. dedicated to appraisal professionals. In addition to E&O, AI members now also have access to LIA’s endorsed General Liability and Cyber Liability Insurance products, offering comprehensive protection for today’s evolving risks.
Presenter: Steven Bauer, Attorney, Gaglione, Dolan & Kaplan
During this session, experienced outside counsel will spotlight the latest litigation trends and liability risks impacting both residential and commercial appraisers. Attendees will walk away with practical strategies for risk management, a stronger understanding of how claims arise, and best practices for mitigating exposure in a shifting legal landscape.
Key Litigation Issues to Be Covered
- Overvaluation and Undervaluation Claims
Why appraisers are frequently drawn into disputes when market performance, foreclosures, or resales differ from their opinions of value. - Bias and Fair Housing Allegations
The rising wave of appraisal bias claims, federal scrutiny, and how appraisers can protect themselves through sound practice and documentation. - Engagement Letter and Scope-of-Work Disputes
How unclear assignment terms create litigation risk — and steps to ensure clarity and defensibility. - Third-Party Liability
Expanding exposure from borrowers, buyers, and others outside the client relationship, and strategies to limit liability. - Regulatory and Disciplinary Proceedings
The interplay between board complaints, federal investigations, and civil claims. - Risk Management Best Practices
Practical steps appraisers can take to reduce exposure — including maintaining independence, careful recordkeeping, and leveraging liability insurance.
IVSC Valuation Webinar Series 2025, Sponsored by Kroll
Now in its sixth year, the IVSC Valuation Webinar Series brings together valuation professionals from around the world to explore the forces shaping the profession in 2025.
Program Highlights:
- From Inflation to Innovation—Key global trends redefining valuation in 2025 (Nov. 4, 11:00 a.m.–12:30 p.m. ET)
- Valuing the Invisible—New guidance for valuing intangible assets (Nov. 5, 4:00–5:00 a.m. ET)
- Tech-Enabled, Profession-Led—How technology is transforming valuation practice (Nov. 6, 5:00–6:00 a.m. ET)
- Valuation Under Scrutiny—Lessons from valuation disputes and regulatory cases (Nov. 11, 8:00–9:00 a.m. ET)
- Mind the Gap—Exploring divergence between public and private real estate values (Date TBC)
Student Affiliate Webinar
Don't miss out on this opportunity designed specifically for students interested in the appraisal profession and career pathways. Join us October 21 for our Student Affiliate Webinar and gain valuable insights and guidance for those considering appraisal as a future profession.
What You’ll Learn:
- Discover the Appraisal Profession: Gain an understanding of the appraisal field and the career options it offers.
- Steps to Become Licensed: Learn the process of becoming a licensed appraiser in the United States.
- AI Designations & Membership: Build awareness of prestigious Appraisal Institute designations and explore membership opportunities beyond Student Affiliate status, including discounted dues as you transition into new membership categories.
- Student Benefits: Hear how AI supports students with resources, networking, and reduced costs.
- Live Q&A with Appraisers: Engage with two certified appraisers (one MAI, one SRA) who will share their professional journeys and answer your questions.
Advocacy Updates
Make Your Voice Count: Tell Congress to Modernize Appraisal Licensing!
As an Appraisal Institute member, you know your AI team works tirelessly in Washington, D.C., and state capitals to represent your interests. But to truly make an impact, members of Congress need to hear directly from you. Your firsthand experience as an appraiser— and as their constituent—is what makes the difference when lawmakers decide how to vote.
Right now, the House Financial Services Committee is determining which bills to include in upcoming housing legislation markups—the process where committee members debate, amend, and rewrite proposed laws. This is the critical moment to speak up in support of the Portal for Appraisal Licensing Act (H.R. 5520), a bill that would streamline and modernize the appraisal licensing system. The legislation mirrors successful regulatory frameworks used in other industries, such as insurance and mortgage origination, helping to cut red tape and improve efficiency for appraisers nationwide.
Contacting your representative is simple. Click this link and type in your address to find your members of Congress. Your two senators will appear first, followed by your House representative. For this alert, please reach out specifically to your representative in the House. When you call, be sure to mention that you’re a constituent and a member of the Appraisal Institute. If you’re calling outside of business hours, don’t hesitate to leave a voicemail—it’s an excellent way to make your voice heard.
Here’s a quick message you can use when calling or emailing:
I’m a constituent and member of the Appraisal Institute, the largest professional association of real estate appraisers in the United States. I urge you to co-sponsor H.R. 5520, the Portal for Appraisal Licensing Act, which will modernize and streamline the real estate appraisal licensing system, similar to the structures used successfully in other industries. Please also ask House Financial Services Committee Chair French Hill to include this bill in the next markup.
After you’ve made your call or sent your message, please let us know how it went. Every individual effort strengthens our collective voice and helps ensure that Congress understands how critical appraisal modernization is to both our profession and the broader real estate market. Together, we can make a lasting difference—but only if we speak up
Real Estate Horizons
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Your Community
Nominate a Colleague for the William S. Harps DEI Award
The William S. Harps DEI Award honors an Appraisal Institute Member who truly exemplifies the values of diversity, equity, and inclusion in the valuation profession and has actively worked to make the profession reflective of all the communities we serve. It commemorates the legacy of William S. Harps, MAI—the first African American to earn the MAI designation (1960), former president of the American Institute of Real Estate Appraisers (1981), and a leader in breaking barriers in the appraisal profession. Harps passed in 2009.
A few examples of notable contributions include:
- Mentoring or advancing underrepresented individuals to the profession
- Leading initiatives or projects that significantly enhance equity and inclusion
- Building programs that increase access for all within appraisal
Do you know an AI Member who fits this description? Nominate them today and help us shine a spotlight on those making a lasting impact.
Until Next week
Team Appraisal Institute
