For years, veterans and active-duty military personnel enjoyed one of the best deals in real estate: the “No-No” VA loan\u2014no down payment, no private mortgage insurance (PMI), and, until recently, no hassle over who paid the buyer\u2019s agent. That last part? Gone. Thanks to the National Association of Realtors (NAR) settlement, the rules of the game have shifted\u2014and veterans are now playing on a different field.<\/p>\n
Before August 17, 2024, the process was simple. Sellers paid the buyer\u2019s agent commission\u2014typically 2.5% to 3%of the home\u2019s sale price\u2014as part of the standard 5% to 6% total commission split between both agents. For veterans using a VA loan, the Department of Veterans Affairs (VA) explicitly prohibited them from paying their agent\u2019s commission directly, ensuring they weren\u2019t hit with unexpected costs at closing. The system worked, and veterans got the keys to their homes without extra financial strain.<\/p>\n
But now? The NAR settlement has blown up that model. Sellers are no longer required to pay the buyer\u2019s agent. Buyers\u2014including veterans\u2014must now negotiate their agent\u2019s fee upfront, either by convincing the seller to cover it or paying it themselves. And while the VA has updated its rules to allow veterans to pay these fees (something that was forbidden before), that doesn\u2019t change the fact that thousands of dollars in unexpected costs could now stand between a veteran and their dream home.<\/p>\n
The March 2024 settlement\u2014a $418 million agreement between the NAR and home sellers who sued over inflated commission practices\u2014didn\u2019t just tweak the system. It rewrote the rules. Here\u2019s what changed:<\/p>\n
\u2022 No More Automatic Seller-Paid Commissions<\/strong><\/p>\n Before, sellers had to offer a commission to the buyer\u2019s agent, and it was non-negotiable. Now? It\u2019s optional. Sellers can choose to offer nothing, leaving buyers to cover their agent\u2019s fee\u2014or risk losing representation in a competitive market.<\/p>\n \u2022 Buyers Must Sign a Contract Before House Hunting<\/strong><\/p>\n Want to tour a home? First, you\u2019ll need a signed agreement with your agent outlining their fee. No more casual showings\u2014this is a legal commitment before you even make an offer.<\/p>\n \u2022 VA Loans Had to Adapt\u2014or Veterans Would Get Left Behind<\/strong><\/p>\n The VA quickly revised its policies to allow veterans to pay buyer-broker fees, something that was strictly prohibited before August 2024. Why? Because without this change, veterans would\u2019ve been shut out of the market overnight. But now, they face a harsh reality: If the seller won\u2019t pay, the veteran must.<\/p>\n So, what does this mean for veterans trying to buy a home today?<\/p>\n 1. The “No-No” Loan Now Comes with a Catch<\/strong><\/p>\n The VA loan still offers no down payment and no PMI\u2014two of its biggest perks. But the “no extra costs” part? That\u2019s over. If a seller refuses to pay the buyer\u2019s agent, a veteran could be on the hook for $10,000, $15,000, or more in agent fees on a typical home purchase. For many, that\u2019s a deal-breaker.<\/p>\n 2. Sellers Hold All the Power\u2014And Are Just Finding Out<\/strong><\/p>\n In a hot market, sellers can afford to be picky. If a veteran\u2019s offer doesn\u2019t include seller-paid agent fees, their bid might get tossed aside in favor of a buyer whose agent is already covered. Veterans now have to compete harder\u2014and that could mean paying more just to stay in the game.<\/p>\n 3. Agents Are Rethinking Who They Work With<\/strong><\/p>\n Some agents may hesitate to take on VA buyers if they know the seller won\u2019t pay their fee. Why? Because 3% of $400,000 is $12,000\u2014and if the buyer can\u2019t (or won\u2019t) pay, the agent works for free. Veterans need to find an agent willing to fight for them\u2014or risk being left without representation.<\/p>\n 4. The VA\u2019s Quick Fix Isn\u2019t Enough<\/strong><\/p>\n The VA\u2019s decision to allow veterans to pay agent fees was a necessary move, but it doesn\u2019t solve the core problem: Most veterans don\u2019t have an extra $10K+ lying around to cover their agent. The VA loan was designed to remove financial barriers\u2014not create new ones.<\/p>\n The game has changed, but veterans aren\u2019t out of the fight. Here\u2019s how to adapt and still land the home you want:<\/p>\n 1. Be Ready to Walk Away.<\/strong><\/p>\n Not every home is worth overpaying or covering extra fees. If a seller won\u2019t budge, keep looking. The right home\u2014and the right deal\u2014will come along.<\/p>\n 2. Not all agents understand VA loans\u2014or are willing to negotiate hard for veterans.<\/strong><\/p>\n Work with someone who specializes in VA loans and knows how to structure offers to include seller-paid fees.<\/p>\n 3. Look for homes where the seller is motivated (divorce, relocation, inheritance). Consider stale listings.<\/strong><\/p>\n Motivated sellers and those who\u2019ve been on the market a while (check your local average DOM \u201cdays on market\u201d and focus on properties that are past that average number) are normally more willing to make concessions.<\/p>\n The VA loan is still one of the best deals in real estate\u2014no down payment, no PMI, and competitive rates. But the NAR settlement has added a new hurdle: buyer\u2019s agent fees. Veterans now have to negotiate harder, budget smarter, and choose their agents wisely.<\/p>\n The “No-No” loan isn\u2019t gone\u2014but it\u2019s not as simple as it used to be. For veterans who adapt quickly, the dream of homeownership is still within reach. For those who don\u2019t? The market just got a lot tougher.<\/p>\n","protected":false},"excerpt":{"rendered":" For years, veterans and active-duty military personnel enjoyed one of the best deals in real estate: the “No-No” VA loan\u2014no down payment, no private mortgage insurance (PMI), and, until recently, no hassle over who paid the buyer\u2019s agent. That last part? Gone. Thanks to the National Association of Realtors (NAR) settlement, the rules of the […]<\/p>\n","protected":false},"author":137,"featured_media":7339,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-7326","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-article"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/posts\/7326","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/users\/137"}],"replies":[{"embeddable":true,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/comments?post=7326"}],"version-history":[{"count":4,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/posts\/7326\/revisions"}],"predecessor-version":[{"id":7337,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/posts\/7326\/revisions\/7337"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/media\/7339"}],"wp:attachment":[{"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/media?parent=7326"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/categories?post=7326"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/realestateagentmagazine.com\/wp-json\/wp\/v2\/tags?post=7326"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}The New Reality for Veterans: Higher Costs, Tougher Negotiations<\/h3>\n
Pro Tips<\/h3>\n
The Bottom Line: The “No-No” Loan Isn\u2019t Dead\u2014But the Rules Have Changed<\/h3>\n