Willow and Hearth

The Countdown to September 30

The National Flood Insurance Program’s authority to sell and renew coverage expires at 11:59 p.m. on September 30, 2026, according to the National Association of Realtors. The deadline traces back to a stopgap deal Congress passed after a brief government shutdown at the end of January, which reauthorized the program only through the end of the current fiscal year rather than settling the issue long-term.

If the deadline passes without action, FEMA loses the authority to write new flood insurance policies or renew existing ones, per NAR. Homeowners who already have a policy in force keep their coverage, and claims on existing policies keep processing as long as FEMA has funds available. What stops is anything new: no new policies, no renewals, and no way for a homebuyer in a flood zone to bind a fresh policy the way most purchase contracts require before closing.

That mechanic is what puts closings at risk. Federally backed mortgages on homes in designated flood zones generally require flood insurance before a lender will fund the loan, and for many of those properties the federal program is the only realistic option. NAR estimates that roughly 1,300 to 1,360 home sales close every day nationwide with a dependency on the program, which works out to tens of thousands of closings a month, according to figures compiled by real estate industry trackers including Call The Local. States with heavy flood-zone exposure, including Florida, Texas and California, carry an outsized share of that risk.

For a buyer with a closing scheduled the week of September 30, the practical question is simple and largely unanswered: will the lender fund the loan if the flood policy cannot be issued that week. NAR notes that federal lending regulators have, in the past, given individual lenders some discretion to close loans in flood zones during a lapse, but that discretion is not guaranteed and varies lender to lender. Private flood insurance, which operates independently of the federal program, remains available and unaffected by a lapse, though it is not offered on every property and can carry higher premiums than the federal program’s rates.

This is not the first time buyers have been left waiting on Congress this cycle. A separate lapse in late 2025 lasted 43 days and stalled flood insurance issuance nationwide before Congress acted, according to National Mortgage Professional. NAR’s public position going into this deadline is to press Congress and the White House for “the longest extension possible” rather than another short-term patch, arguing that repeated near-lapses are themselves destabilizing the housing market even when Congress ultimately acts in time. For now, real estate agents in flood-prone markets are advising clients to build extra buffer into closing timelines and to ask their lenders directly how a lapse would be handled, because as of this week, nobody outside Congress can say for certain.