VA will suspend rule and work to ban buyer’s premium – RISMedia

The U.S. Department of Veterans Affairs (VA) plans to issue a circular before June 12 following the National Association of REALTORS® (NAR)’s historic settlement in hopes of closing the loophole on the buyer’s commission ban between buyer’s agents and veterans.

Department of Veterans Affairs Deputy Director of Policy Michelle C. Corridon announced Tuesday at the Mortgage Bankers Association (MBA) Secondary and Capital Markets Conference and Expo that the VA is temporarily adopting this circular as a temporary placeholder amid a formal rulemaking process Considers eliminating regulations that prohibit veterans from paying their own commissions to agents and brokers when they take out VA home loans.

“We knew at some point that we wanted to protect veterans as best we could,” Corridon said he told National Mortgage News. “We want them to be able to exercise their right to buy a home in the market.

“That is the heart of the circular, and then we will begin rulemaking, and that will be the entire rulemaking, proposal and comment period,” she added.

The MBA has been pushing for these rule changes for months and previously issued the following letter to the VA:

“As we have previously emphasized in our discussions on this issue, MBA urges the VA to modify its regulations to allow experienced borrowers to pay reasonable and customary fees and commissions to engage agents to represent their interests in the transaction represented,” the letter says. “If the VA believes it needs to go through the rulemaking process to change its regulations, MBA recommends that the VA publish an interim final rule to ensure that veterans who wish to use their VA benefits are informed throughout the comment period and remain competitive throughout the rulemaking process.”

NAR has also met with VA officials and lawmakers to push for change and ensure veterans have access to representation from realtors in the home buying process.

“NAR launched a comprehensive advocacy effort on this issue, meeting with VA officials, engaging with legislators and convening our industry partners to ensure this ban is overturned,” said NAR Chief Advocacy Officer Shannon McGahn. “This is also a testament to the thousands of REALTORS® who came to Washington just weeks ago with a unified message. Without this change, thousands of experienced buyers could be denied access to professional representation in achieving the American Dream of homeownership. This additional step ensures that veterans have the same opportunities as others to compete in a tight housing market. We applaud the VA for recognizing this danger and acting quickly to protect veterans.”

It was unclear when the VA would publish a proposed rule or begin the formal process to change the buyer’s premium rules on VA loans. Changing a rule often requires several months, including multiple rounds of public comment or hearings and reviews by other government agencies.