Effective August 10, 2024, the Department of Veterans Affairs (VA) has issued a temporary policy change that allows veteran homebuyers to pay their own real estate agent’s (buyer-broker) fee under specific conditions.

What’s New?

In the past, VA buyers were not allowed to pay for buyer-broker services—those fees were typically paid by the seller. But due to recent changes in the real estate market, where many Multiple Listing Services (MLS) no longer allow listing brokers to offer or control buyer-agent compensation, this rule was putting VA buyers at a disadvantage.

To address this, VA released Circular 26-24-14, creating a temporary local variance that gives VA buyers more flexibility and keeps them competitive in today’s market.

Key Points of the Temporary Rule:

1. When This Applies
You may pay your own buyer-broker fee if:

You’re purchasing in a market where listing brokers are not allowed to set or pass on compensation to buyer agents through the MLS.
Compensation for buyer agents cannot be negotiated through or paid by the listing side.

2.  How It’s Paid

Buyer-broker fees must be paid out-of-pocket; they cannot be financed into the VA loan.
You’ll need to have enough liquid funds to cover these costs at closing.
The fee must be disclosed on the Closing Disclosure under section H (“Other”).

3.  Buyer Representation Agreement

The buyer-broker agreement becomes part of the loan file and must be submitted when requesting an appraisal.

What This Means for You

 You can now agree to pay your buyer-agent’s fee directly if needed, giving you access to homes that may not offer compensation to buyers’ agents.
 Sellers may still cover the buyer-broker fee if negotiated in your purchase offer. This is still allowed and is not considered a seller concession under VA rules.
This rule change gives you more flexibility and negotiating power, but it also means understanding your financial obligations before entering into a buyer-broker agreement.

Next Steps

If you’re planning to buy a home using your VA loan benefit, it’s important to know your options and understand how this change may affect your transaction. As your VA-experienced real estate broker, I’ll guide you through the process and ensure your purchase is structured to protect your benefits and your budget.

Contact me anytime with questions or to schedule a personalized consultation.