The National Flood Insurance Program (NFIP) could face a government shutdown if Congress fails to reauthorize it before the shutdown, potentially denying mortgage applications for property purchases in flood-prone areas.

The NFIP warns that it would not be able to sell flood insurance and borrow funds in the event of a closure, but can still process and pay claims as long as funds are available.

This could significantly impact property sales in high-risk flood zones along the coast and inland near flood-prone rivers.

The Mortgage Bankers Association (MBA), National Association of Home Builders (NAHB), National Association of Realtors (NAR), Institute of Real Estate Management (IREM), and CCIM Institute have written a joint letter to Congress, urging an urgent extension of the NFIP to prevent its expiration during hurricane season.

Floods are the most prevalent and destructive natural disaster in the United States, accounting for over 90% of all natural disasters.