Appraisal Industry Improvement Act
Introduced November 12, 2025 · Last action November 12, 2025
Plain English Summary
This bill allows State-licensed real estate appraisers (not just federally-certified appraisers) to conduct appraisals for FHA-insured mortgages, provided they meet education and competency standards. It also creates a national registry for State-credentialed trainee appraisers, allows certified appraisers to use trainee appraisers as assistants under their supervision, and authorizes grants to support appraiser workforce training and recruitment.
Who benefits
State-licensed real estate appraisers who are not federally-certified will gain access to FHA mortgage appraisal work currently restricted to certified appraisers; trainee appraisers entering the profession gain a formal pathway through State credentialing; appraisal management companies may benefit from adjusted (and potentially lower) registry fees; nonprofit organizations and colleges offering appraiser training programs gain access to federal grant funding; mortgage lenders may benefit from increased appraiser supply and potentially lower appraisal costs.
Who pays / loses
Federally-certified appraisers may face increased competition from State-licensed appraisers entering the FHA mortgage market; appraisal management companies may see registry fee structures subject to change; the federal government will bear costs of workforce training grants; trainee appraisers assume liability risk if their work is used by supervising appraisers who retain final liability.
Funding & Lobbying Interests
The bill benefits State appraiser licensing boards and organizations that lobby for reduced federal appraisal credential requirements, including State appraisal organizations and real estate trade groups seeking to expand the pool of eligible appraisers. Nonprofits and higher education institutions in appraiser training stand to gain from the new grant program. Mortgage lenders and real estate associations typically support policies that increase appraiser supply and reduce appraisal costs. The sponsors (Rep. Byron Donalds, R-FL; Rep. Brad Sherman, D-CA; Rep. Stephanie Bynum, D-OK) represent districts with significant real estate and mortgage lending interests.
Political Impact
Affected Groups
State-licensed real estate appraisers (precise number not stated in bill); trainee appraisers entering the profession; FHA mortgage borrowers (approximately 1.5 million FHA mortgages originate annually based on historical data); mortgage lenders originating FHA loans; appraisal management companies; nonprofits and colleges in States that establish trainee appraiser programs.
Political Subtext
Proponents argue the bill increases appraiser supply and reduces barriers to entry, particularly for State-licensed appraisers who may be denied FHA work despite meeting competency standards, and supports workforce development in a profession experiencing labor shortages. Proponents characterize current FHA requirements as needlessly restrictive. Critics argue that allowing State-licensed (rather than federally-certified) appraisers into FHA mortgages may reduce appraisal quality and consistency, as federal certification has historically been considered a higher standard. They contend that trainee appraisers conducting unsupervised work (even under certified appraiser liability) increases risk of valuation errors. Non-partisan evidence from appraiser workforce studies shows chronic undersupply of appraisers since 2008, but no rigorous peer-reviewed research directly compares quality outcomes between State-licensed and federally-certified appraisers on FHA mortgages.
Real-World Stakes
If this passes, the FHA appraisal market expands to include State-licensed appraisers, potentially reducing appraisal turnaround times and costs for borrowers, but may introduce inconsistency in valuation standards if State licensing requirements vary significantly. Trainee appraiser programs could accelerate workforce entry but depend on States establishing such programs (the bill does not mandate them). Appraisal quality outcomes would depend on quality of State-approved FHA education courses. Analogous precedent: Some States already license appraisers at levels below federal certification; no published federal data directly compares FHA mortgage default rates by appraiser credential type. The bill's grant program parallels workforce development precedents in other industries (nursing, trades) where federal grants support training but do not guarantee supply stability. If appraiser supply increases significantly, appraisal fees may decline, reducing costs for borrowers but potentially affecting appraiser incomes and market consolidation.
Sponsor
Sponsor information not available.
Vote Record
No recorded votes.
Campaign Finance — Primary Sponsor
No campaign finance data available yet.
501(c)(4) disclosure: Contributions from 501(c)(4) "dark money" organizations are not required to be publicly disclosed and are not reflected in the figures above. Data sourced from FEC public disclosure filings.
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