Appraisal Industry Improvement Act
- Bill Number
- H.R. 6025
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Housing and Community Development
- Status
- Introduced
- Latest Action
- 2025-11-12: Referred to the House Committee on Financial Services.
- Last Updated
- 2026-06-11T23:26:38Z
AI-Generated Summary
Purpose
The Appraisal Industry Improvement Act (H.R. 6025) aims to modernize the appraisal process for mortgages insured by the Federal Housing Administration (FHA), a government program that helps people buy homes with lower down payments. It expands who can perform these appraisals, ensures appraisers meet education and skill standards, and supports training to address shortages in the appraisal workforce.
Key Provisions
- Appraisal Standards (Section 2): Updates rules so state-licensed or certified appraisers can conduct FHA appraisals. Appraisers must follow the Uniform Standards of Professional Appraisal Practice (a set of national guidelines for fair and accurate property valuations) and complete FHA-specific education, such as a course on FHA appraisal rules provided by the FHA or an approved third party. Federal employees focused on appraisals need certification in only one state to work nationwide. Existing approved appraisers are grandfathered in and exempt from new education rules if approved before the law's effective date.
- Implementation Timeline: The Secretary of Housing and Urban Development (HUD) must issue guidance within 240 days of enactment, effective 180 days after issuance, outlining requirements and a way for appraisers to prove prior compliance.
- Annual Registry Fees (Section 3): Allows the Appraisal Subcommittee (a federal oversight body) to adjust fees for appraisal management companies (firms that assign appraisal work) with council approval, to fund oversight activities.
- State Credentialed Trainees (Section 4): Adds state-credentialed trainee appraisers (entry-level individuals meeting basic qualification standards) to the national registry maintained by the Appraisal Subcommittee. States must report on their credentials and disciplinary actions. Certified appraisers can use trainees' help on federally related appraisals (those tied to government-backed loans), but the certified appraiser remains responsible for the final work. States are not required to create trainee programs.
- Grants for Workforce and Training (Section 5): Expands federal grants to state licensing agencies, nonprofits, and colleges for appraiser education, recruitment, scholarships, and career development to build the appraisal workforce.
- Appraisal Subcommittee Membership (Section 6): Adds the Department of Veterans Affairs, Rural Housing Service (part of the Department of Agriculture), and HUD to the federal council overseeing the Appraisal Subcommittee.
Significant Changes to Existing Law
- Expansion of Eligible Appraisers: Previously, FHA appraisals often required appraisers certified at a higher level or from specific rosters; now, state-licensed appraisers can qualify if they meet education and competency rules, broadening the pool of available professionals.
- Education and Training Mandates: Introduces a new requirement for FHA-specific training, which was not explicitly mandated before, while allowing flexibility for federal employees and existing appraisers.
- Trainee Integration: For the first time, state-credentialed trainees are formally included in the national registry and can assist on certain appraisals, promoting entry into the field without mandating state programs.
- Fee and Grant Flexibility: Enables fee adjustments for better funding of oversight and adds workforce development grants, shifting from prior rigid structures.
- Oversight Expansion: Broadens the Appraisal Subcommittee's coordinating council to include more housing-related agencies, enhancing coordination.
Potential Impacts
- Government Agencies: HUD and the FHA will need to develop and deliver training, issue guidance, and manage a larger pool of appraisers, potentially reducing delays in loan processing. The Appraisal Subcommittee gains fee adjustment authority, improving funding for monitoring appraisal quality.
- Citizens: Homebuyers using FHA-insured mortgages (often first-time or low-income buyers) may face fewer appraisal delays and lower costs due to more appraisers, speeding up home purchases and supporting affordable housing access.
- International Relations: No direct impacts, as the bill focuses on domestic housing finance and appraisal standards.
- Broader Economy: Could address appraisal industry shortages, stabilizing the housing market by ensuring timely valuations for loans.
Main Stakeholders Affected
- Appraisers and Trainees: Gain expanded opportunities to work on FHA loans, with new training requirements and pathways for entry-level professionals.
- Appraisal Management Companies: Face potential fee changes but benefit from a larger workforce.
- Lenders and Mortgagees: Easier access to qualified appraisers, reducing bottlenecks in FHA loan approvals.
- State Agencies: Responsible for licensing and reporting on appraisers and trainees; eligible for grants to support programs.
- Federal Agencies (HUD, FHA, VA, USDA): Increased roles in training, oversight, and coordination.
- Homebuyers and Borrowers: Primarily low- to moderate-income individuals relying on FHA insurance for homeownership.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens compliance with existing federal appraisal standards (like those from the Appraiser Qualification Board) by mandating verifiable education, potentially reducing appraisal errors or biases in FHA loans. The grandfathering clause avoids retroactive burdens on current appraisers, minimizing legal challenges.
- Constitutional: No apparent issues; the bill operates within Congress's authority over interstate commerce and housing finance, without infringing on free speech, due process, or state rights (states retain control over licensing).
- Political: Addresses appraisal workforce shortages highlighted in housing policy debates, promoting equity in home valuations (e.g., reducing barriers for diverse appraisers). It could face support from housing advocates for expanding access but scrutiny from industry groups over new training costs; overall, it fosters bipartisanship by balancing regulation with flexibility.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (2)
Rep. Sherman, Brad [D-CA-32], Rep. Bynum, Janelle S. [D-OR-5]
Recent Actions
- 2025-11-12: Referred to the House Committee on Financial Services.
- 2025-11-12: Introduced in House
- 2025-11-12: Introduced in House
Bill Versions
- Appraisal Industry Improvement Act — issued 2025-11-12 — PDF (9 pages)