VA updates home loan benefits to help veterans in competitive housing market

VA updates home loan benefits to help veterans in competitive housing market

The Department of Veterans Affairs (VA) is taking steps to ensure that veterans who use the VA-guaranteed home loan benefit remain competitive when trying to buy a home.

The National Association of Realtors reached a settlement in a class-action lawsuit in March, the result of which is that real estate buyer-broker fees are likely to be the home buyer’s responsibility. Under the VA’s home loan program, those fees have been paid by the seller.

Effective Aug. 10, veterans using home loan benefits will be able to pay certain buyer-broker fees. In announcing the change on June 11, the VA stated that the Under Secretary for Benefits “has determined this temporary variance is appropriate to ensure veterans remain competitive buyers in the rapidly shifting real estate brokerage market. VA will develop a more permanent policy, through a new notice-and-comment rulemaking, as the real estate brokerage market restabilizes and new practices take hold.”

The VA encourages veterans to negotiate buyer-broker fees with their real estate professional and noted that veteran homebuyers can still ask the seller to cover those fees at closing.

In a statement, National Association of Realtors President Kevin Sears said, “The VA's home loan guaranty is the only program that explicitly bans buyers from directly paying for professional real estate representation. We applaud the VA for revising this policy and allowing veterans and active-duty service members the same advantages as other buyers in a competitive real estate market.”

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