In the wake of the $418 million settlement by the National Association of Realtors (NAR) that will result in changes to the real estate agent commission structure, a new problem arose regarding veterans seeking to buy a home using a VA home loan.
Under the current policies of the U.S. Department of Veterans Affairs, retired military personnel using the VA home loan benefit cannot compensate their realtor directly. And with a new commission structure coming into place where compensation is not offered to a buyer’s agent from a seller, veterans will have the choice of either working without a realtor, choosing another loan product or not buying a home.
Kevin Sears, NAR’s 2024 president, sent a letter to John Bell, executive director of the loan guaranty service within the VA’s Veterans Benefits Administration, asking the department to change its policies regarding the fees on the VA home loan.
“Realtors serve as advocates for homebuyers through the entire purchasing process, many of whom specialize in working with VA buyers,” Sears wrote. “In this exceedingly competitive market, we are concerned that the VA’s current policies place veterans at a significant disadvantage compared to traditional buyers.”
Sears added the VA home loan guaranty program “is a vital homeownership tool that provides veterans with a centralized, affordable, and accessible method of purchasing homes as a benefit they earned for their service to our nation. NAR wants to ensure that VA buyers remain active participants in the real estate market to achieve the American Dream of Homeownership.”
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A veteran can still buy a home, just ask the listing agent.
Veterans will have a fourth choice, to work with the listing agent via dual agency if the seller agrees.
In MD, using 1 agent is not a dual agency.
We can only represent one person at a time, therefore the buyer will have no representation, working with the listing agent.
I’m a veteran getting to use VA loan. I was a CA realtor and getting a GA license. Glad to see NAR punch holes in the settlement. The $418M settlement was forced on NAR. Otherwise, if taken to court, NAR would see a $5B verdict against them. The case was a setup where NAR could not win.
Of the $418,000,000, 33% or $137,940,000 is going to the attorneys. I question why the attorneys are entitled to 33% of this settlement. That is excessive. A far difference than the 2.5% I work hard to make
These changes are honestly good for no one, especially Veterans and first time home buyers. They are the losers in this lawsuit.
If a buyer works directly with the listing agent, the seller must agree to release their listing agent from representing them and becoming a neutral transaction broker. This means the listing agent can’t advocate for either side, leaving both sides without full representation.