VA Loans and Buyer Representation

 

We all know that some changes are coming to how real estate is bought and sold because of the NAR (National Association of REALTORS) settlement recently. We will talk about that more soon. One BIG change that is coming is that buyers’ agents commissions will not be published in MLS listings. It also means that there will be some sellers who do not cover the buyer agent commission as part of the listing agreement. So, there are a number of new things that must be worked out if a buyer wants representation (and we think they should). 

 

What you may not know is that VA loan buyers have not legally been able to pay commissions for buyer representation. It has come from the seller side. 

 

The NAR settlement has now created a really tough situation for this group because if there is no coop compensation, the buyer agent will not be paid for VA buyers. Who works for free? No one. So, VA buyers, without representation, will be in a bind. 

 

BUT! This past week, the Veteran’s Administration deputy director Michelle Corridon made an announcement at the Mortgage Banker Association’s meeting that the VA will be rolling out a temporary fix to the commission issue and will soon release a circular that “bridges the gap”.

 

Ok. It’s a start. The government actually moved pretty quickly on this. 

 

The details are forthcoming, but there is light at the end of the tunnel.

 

What would be really cool is if this started the process to just get the lending industry to allow for buyer commissions to be paid straight out of the loan proceeds. It is in indirect fashion anyway.