VA Loans and the Possible Impact of the Proposed NAR Agreement 03/20/2024

The National Association of Realtors (NAR) plays a pivotal role in shaping the real estate landscape in the United States. Recently, the proposed NAR agreement has stirred discussions across various sectors, particularly among veterans and active service members who utilize VA loans to buy a home or refinance an existing loan. This agreement, if implemented, could have unforeseen implications for those looking to use the program. VA loans are a vital resource and a true benefit, offering favorable terms, no down payment requirements, competitive interest rates, and lenient underwriting that can allow lower credit score borrowers to be approved. 

However, the proposed NAR agreement has raised concerns among veterans and advocates alike. At the heart of the agreement is the potential for changes to the structure of real estate commissions. The agreement aims to address concerns related to transparency and competition in the real estate industry by allowing more flexibility in commission structures. While this could lead to greater transparency and potentially lower costs for consumers, there are fears that it may also inadvertently impact veterans, especially when a veteran home buyer who is using a VA loan is required to pay out of their pocket the commission for a real estate agent.

Scissortail Financial wants to provide facts regarding this situation. Here is the actual guideline when it comes to real estate agent compensation and veteran loans. This guideline, straight from the VA, will help address your questions and provide answers. 

c. Brokerage Fees- Fees or commissions charged by a real estate agent or broker in connection with a VA loan may not be charged to or paid by the veteran-purchaser. While use of “buyer” brokers is not precluded, veteran-purchasers may not, under any circumstances, be charged a brokerage fee or commission in connection with the services of such individuals. Since information on property available for purchase and financing options is widely available to the public from a variety of sources, VA does not believe that preventing the veteran from paying buyer-broker fees will harm the veteran.

We also want to provide a link to the National Association of Realtors press release responding to the agreement. There is much speculation and inaccurate infomriaotn floating around and just like referencing the VA guideline above, we feel that it is best to make informed decisions using facts from the National Association of Realtors themselves.

www.nar.realtor/newsroom/nar-reaches-agreement-to-resolve-nationwide-claims-brought-by-home-sellers

Please feel free to reach out to our team of experienced mortgage professionals with any questions about this topic or how it could impact you personally.  We are ready to help!