VETERANS PRESS: What real estate industry changes mean for VA home loan borrowers
Recently, one of the largest real estate professionals (REPs) trade organizations — the National Association of Realtors (NAR) — has been in the news regarding a settlement concerning buyer-broker compensation. Effective since Aug. 17, 2024, the National Association of Realtors (NAR) has reached a settlement in a class action lawsuit that resulted in changes to buyer broker fees in real estate transactions. Here’s how that could affect Veterans and service members using VA’s home loan benefits.
What are the changes?
The settlement will require two big changes in how buyers and sellers are negotiating services from a buyer’s agent:
1. When agents list homes on the Multiple Listing Service (MLS) platform, they will no longer be able to include the buyer’s agent’s compensation. The MLS is the listing program that buyers’ brokers and listing brokers use to share information about properties for sale.
2. Buyers will be required to enter into written agreements with Realtors before touring a home, and the agreement must include terms about their own agent’s fee.
Why does this change matter for Veterans using the VA-guaranteed home loan benefit?
Historically, Veterans could not pay buyer-broker fees when purchasing a home with a VA-guaranteed loan. In June, VA announced an update to help ensure that Veterans using the VA-guaranteed home loan benefit remain competitive buyers. Specifically, eligible Veterans, active duty service members and surviving spouses who use their VA home loan benefits can pay for certain real estate buyer-broker fees when purchasing a home as of Aug. 10, 2024. This update was intended to ensure VA’s programs continue to promote access to homeownership.
For additional information about this update, please review VA Circular 26-24-14: “Temporary Local Variance for Certain Buyer-Broker Charges,” on VA’s Loan Guaranty Service Resources page. https://www.benefits.va.gov/HOMELOANS/resources_circulars.asp