Fannie Mae and Freddie Mac recently provided further clarification on the handling of real estate agent commissions. This update follows a nationwide settlement proposal by the National Association of REALTORS® (NAR) and aligns with statements issued earlier this year. Importantly, there are no changes to the current structure of seller-paid buyer agent fees.
Key Commission Policy Updates
Under the existing policies of Fannie Mae and Freddie Mac, buyer agent fees, typically covered by the property seller or the seller’s real estate agent, are not considered financing concessions. Consequently, these fees will continue to be excluded from the financing concession limits if they remain seller-paid (Marketplace Homes) (ABA Banking Journal).
Summary of the NAR Settlement
The National Association of Realtors (NAR) has reached a significant settlement aimed at increasing transparency within the real estate industry. Key points include:
- The settlement addresses allegations related to broker commissions and reaffirms that commissions have always been negotiable.
- New regulations will prohibit listing compensation offers on the MLS and require MLS participants to secure written agreements with buyers before home tours commence.
Implications of the Settlement
When the new rules are implemented, buyers will gain more flexibility in selecting and paying for real estate services they deem necessary. Written agreements will outline agent fees and services upfront, allowing buyers to opt for specific services like on-demand showings or negotiation assistance.
The Importance of Using a Real Estate Agent
Working with a real estate agent offers several benefits:
- Expert Guidance: Agents provide valuable insights and help navigate the complexities of the home buying process.
- Access to Listings: Agents have access to a broader range of listings, including exclusive properties.
- Negotiation Skills: Agents can negotiate effectively on your behalf, ensuring you get the best possible deal.
- Legal Protection: Agents help manage the extensive paperwork and legal requirements involved in buying a home.
We will keep you updated with any new developments. If you have any questions about the settlement, need a reputable agent, or want to explore your options, please reach out to us.
Sources: NAR, U.S. World and News