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A Disadvantage for Veterans in the Housing Market: The NAR Settlement and VA Loans

As a veteran myself, I'm deeply concerned about a recent development that could put veterans at a disadvantage when buying a home. The National Association of Realtors (NAR) settlement allows buyers and sellers to negotiate agent fees. While this may seem like a positive step for transparency, it creates a conflict for veterans using VA loans.


Here's the issue: VA loan guidelines strictly prohibit veterans from paying real estate agent commissions. This means that even with a buyer agent agreement, which typically outlines the buyer's responsibility to pay the agent's commission, veterans cannot fulfill this obligation.


While the VA argues that property information is readily available, a good buyer's agent brings immense value. Their expertise in negotiation, market knowledge, and navigating the complex buying process can be invaluable, especially for first-time homebuyers.


So, what happens now?


The obvious workaround:


  • Seller pays the commission: Ideally, the seller would be willing to cover the buyer agent's commission. However, this isn't always guaranteed, especially in a competitive market where multiple offers are on the table.

But this isn't a solid solution. In many cases, a seller may be unwilling to budge on commission, leaving the veteran in a difficult position: forgo representation or forgo the home. This is simply unfair.


What needs to be done?


Veterans deserve a fair shot at homeownership, just like any other buyer. We need a solution that addresses this conflict:


  • VA policy change: The VA could revisit its policy on buyer agent commissions. Perhaps allowing a limited contribution from the veteran or creating a program to connect veterans with agents willing to work under alternative commission structures.

  • Industry collaboration: Real estate agents, lenders, and veteran advocacy groups could work together to create solutions that benefit veterans, such as pre-negotiated commission structures specifically for VA loans.

What are your thoughts?


As a veteran community, we need to raise our voices on this issue. Let me know in the comments below:


  • Do you think the current situation disadvantages VA homebuyers?

  • What solutions would you propose to address this conflict?

  • Have you faced similar challenges as a veteran buying a home?

Getting Help


If you're a veteran with questions about buying a home with a VA loan, I'm here to help. You can reach out to me directly at 707-695-6313, or chat with Trev, my chatbot, who can get your information and connect you with me for a call.


Together, let's work towards a housing market that offers veterans a fair and equal opportunity to achieve the dream of homeownership.


 

About the Author


Frank Garay is a distinguished figure in the mortgage industry, with a career that began in 1987 and spans several decades of exceptional service. He co-founded the National Real Estate Post in 2009, a video blog that quickly amassed over 250,000 subscribers, becoming a staple for real estate professionals nationwide. In 2010, Frank was honored as one of the Inman 100, marking him as one of the most influential people in real estate.


Frank's expertise has also been showcased on national television, where he has been a featured guest on the Fox News show "After the Bell." His insights on real estate and mortgage trends during these appearances have solidified his reputation as a trusted industry expert.


Currently, Frank leads Mortgage Masters of California, where his deep market knowledge continues to drive success. He also hosts the Loan Officer Breakfast Club, a thriving platform for mortgage originators to connect and learn.


If you have any real estate or mortgage needs, do not hesitate to reach out to Frank Garay. His vast experience and proven leadership make him an invaluable resource for navigating the complexities of the housing market. Connect with Frank for expert guidance and superior mortgage solutions.


Reach out to Frank Garay at 707-695-6313, for your real estate and mortgage needs and experience the difference that expert advice can make.


  • To schedule a quick Zoom call with Frank CLICK HERE.

  • To schedule a private First Time Home Buyer Class with Frank CLICK HERE.

  • Real Estate Agent and you want to be featured on the Vibe? CLICK HERE.

  • Want a call from me? Ask my chat bot Trev. She'll set it up.

 




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