The U.S. Department of Veterans Affairs (VA) issued a circular announcing a temporary policy change that will enable borrowers using the VA home loan program to pay certain real estate buyer-broker fees when purchasing a home.
The circular comes in the wake of the class-action settlement involving the National Association of Realtors (NAR) and several major brokerages which resulted upcoming changes to the real estate broker commission structure. Prior to this policy shift, the VA home loan program prevented buyer-broker fee compensation/
The VA stressed the policy change was temporary, adding the department will monitor the effects of the settlement on the brokerage market before pursuing rulemaking on the matter.
“We always want to put Veterans and their families in the best possible position to buy the homes they want, and that’s what this update is all about,” said Under Secretary for Benefits Joshua Jacobs. “Veterans using VA home loan benefits can now pay reasonable and customary amounts for certain charges — including commissions and other broker-related fees — thus ensuring that they remain competitive in the rapidly changing housing market.”
NAR President Kevin Sears issued a statement praising the temporary policy change.
“The VA’s home loan guaranty is the only program that explicitly bans buyers from directly paying for professional real estate representation,” said Sears. “We applaud the VA for revising this policy and allowing veterans and active-duty service members the same advantages as other buyers in a competitive real estate market.”
Sears added that NAR will “support the VA in whatever way possible to protect the brave men and women who serve this country and ensure they are given the equal opportunity to achieve the American Dream of homeownership.”
