For decades, homes in minority neighborhoods have been valued lower than those in comparable white neighborhoods. According to a 2022 study from the National Fair Housing Alliance (NFHA), racial inequalities in appraised values increased by 75 percent from 2013 to 2021.
Discriminatory practices within the appraisal industry widen the racial wealth gap and cause lasting damage to communities of color. An inaccurately low valuation can make it hard for homeowners to secure favorable refinance rates, while also dragging down home values in the community.
Similarly, an inaccurate over-valuation can drive property taxes up for homeowners, pricing out lower-income community members.
Getting appraisals right, in both directions, is key to making homeownership a realistic path to wealth-building for all races and income levels.
Knowing how the appraisal process works, what protections are in place, and how to lodge a complaint are just a few of ways you can protect yourself against discrimination.
Understanding the appraisal process
The aim of an appraiser is to provide an objective valuation on a property using specific characteristics of the home and comparable properties in the area.
They typically look at the home’s size, number of rooms, upgrades, structural integrity, and cost of building the house in today’s market.
Per the Fair Housing Act of 1968, it’s illegal for home appraisers to discriminate based on someone's race, color, religion, sex, disability, family status or national origin. However, if bias creeps in, it can influence an appraiser’s judgment, leading to inaccurate values.
In 2025, the NFHA reported 39 appraisal discrimination complaints for 2024. This number is down from 2023 (87 complaints), but the decline comes with an important caveat: The Department of Housing and Urban Development (HUD) and state fair housing agencies didn’t provide any information about appraisal complaints in 2024, so all 39 came from private nonprofits alone. Among those groups, complaints actually rose 62.5%, from 24 to 39. The dip, as a result, may reflect gaps in government reporting more than an easing of the problem.
» MORE: Ways to strengthen your home's refinance appraisal value
What's changed in appraisal protections
In 2025, the Trump Administration effectively eliminated the Property Appraisal and Valuation Equity (PAVE) task force, which was created in 2021 to combat discriminatory practices within the home appraisal system.
The Appraisal Modernization Act, part of the broader 21st Century ROAD to Housing Act that became law in mid-2026, was introduced to revive PAVE policies and address some of the concerns with appraisal bias. It requires HUD, the Federal Housing Finance Agency (FHFA), the Department of Agriculture (USDA) and the Department of Veteran Affairs (VA) to set consistent, standardized procedures that mortgage lenders must follow when a homeowner requests a Reconsideration of Value (ROV) or a second appraisal.
A related measure, the Appraisal Industry Improvement Act, also eases some licensing and training barriers into the profession, potentially addressing the lack of diversity among appraisers.
The law, however, stops short of what some fair housing advocates had pushed for. An earlier version would have required the FHFA to publicly release property-level appraisal data, giving researchers and advocates a way to track valuation patterns by race and neighborhood. The current law only directs the Government Accountability Office (GAO) to assess the viability of such a database.
Addressing the industry's diversity gap
In the past, national appraiser groups have pledged to address unconscious bias in appraisals, recruit for greater diversity, and provide mentoring and other support.
But, according to 2025 data from the U.S. Bureau of Labor Statistics, women make up just 39.2% of property appraisers and assessors, with Black or African American people making up just 10.9%.
Breaking into the industry is challenging. After finishing the required education, appraisers must complete a certain number of hours under a supervising appraiser to become certified. Finding that supervisor is tough for newcomers who don't know anyone in the field.
Some prominent mortgage lenders have pledged support for appraiser diversity in recent years. One example is Wells Fargo, which partnered with the National Urban League and announced a five-year, $5 million grant to create the Urban Appraisers Initiative, a program designed to increase diversity and reduce barriers to entry in the home appraisal industry.
Chase, Rate, and Flagstar Bank backed similar efforts — donating millions to the Appraisal Institute’s Appraiser Diversity Initiative. However, there doesn’t appear to be any recently published data on how these programs have increased diversity or whether they even remain active — the Appraiser Diversity Initiative is now called the Appraiser Development Initiative — making it hard to assess their impact so far.
How to combat appraisal discrimination
Shop for a fair lender
The lender hires the appraiser when you apply for a mortgage, so keep that in mind when shopping for lenders. Ask friends and family about their experiences with lender appraisal processes.
Consider asking the lender about their process for hiring an appraiser, including the qualifications and professional designations of the appraisers it works with.
Here are some questions you can ask the appraiser before they evaluate your home:
- How long have you been appraising?
- Are you licensed or certified?
- Do you appraise full time?
- Have you ever appraised properties of this type in this area?
- Do you have access to the local multiple listing service (MLS)?
Beware of the emotional costs of 'erasing yourself'
A slew of news stories over the last several years have highlighted instances in which the exact same property was appraised for more when its Black homeowner hid evidence of their race.
While these accounts are recent, the notion of "whitewashing" a home to get a fair value has a long and painful history.
Many in the Black community operate on the understanding that a home seen as race-neutral has a better chance at selling or appraising at a higher price.
Taking down family photos, cultural decor, or any other potential racial identifiers has become a common strategy for Black homeowners seeking a fair appraisal. But erasing your racial identity can have long-term emotional costs.
Carlette Duffy, a Black homeowner, applied for a refinance in 2020 and received a much lower valuation than expected. She requested another appraisal, but this time removed evidence of her racial identity in her home and asked a white friend to pose as her brother to greet the appraiser. The final valuation came back considerably higher. Duffy rejoiced when she got the higher appraisal, but heartbroken by what she had to go through.
Duffy filed multiple complaints with HUD. The one against Jeffrey Pierce, who evaluated Duffy’s home first, is still under investigation. In 2025, a federal judge sided with HUD and ordered Pierce — who still holds an active Indiana appraiser's license — to turn over the appraisal records, with no determination yet on whether discrimination occurred.
Appraisal too low? Submit a Reconsideration of Value (ROV)
The mortgage lender is required to send you a free copy of the appraisal report at least three days before the loan closes. The report details what the appraiser considered when valuing the property. If you think the valuation is wrong, you have the right to submit a Reconsideration of Value, or ROV.
The process to dispute an appraisal varies by mortgage lender, but generally you'll submit written information to the lender with evidence to support your case. The lender will ask the appraiser to address the concerns, and this could result in a revised appraisal.
Most ROVs don't lead to an adjustment of value, but it's still important to pursue an ROV if you think the appraiser got it wrong. Here are some tips for approaching it:
- Scour the report and look for errors, missing information and judgments that may be contestable.
- Check the comparable sales used. Generally the comparables should be similar in size and style to your home, close in proximity (within one mile) and preferably sold within the last three to six months.
- Focus on big issues that are likely to move the needle like comparables, the home’s condition and its quality rating
Suspect discrimination? File a complaint
You can file a complaint with a state or federal agency if you think you've been discriminated against in an appraisal. Here are some places to turn:
Consumer Financial Protection Bureau: If you have been discriminated against during the appraisal process, you can submit a complaint to the Consumer Financial Protection Bureau (CFPB).
Appraisal Complaint National Hotline: To find out which agency to notify, contact the Appraisal Complaint National Hotline operated by the Appraisal Subcommittee of the Federal Financial Institutions Examination Council (877-739-0096). The hotline doesn't handle the complaints but will refer you to the appropriate authority.
Fair housing center or HUD: You can file a fair housing complaint directly with HUD's Office of Fair Housing and Equal Opportunity, or hire an attorney to file a complaint and represent you. You can also get help through your local fair housing center. These organizations receive funding through HUD's Fair Housing Initiatives Program, conduct preliminary investigations and help people navigate the complaint process. The services are free.
It's important to act promptly. You have a maximum of one year from the last date of the alleged discrimination to file a fair housing complaint with HUD.
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