The


National
Association
of
Realtors
(NAR)
and
the


Mortgage
Bankers
Association
(MBA)
are
asking
federal
housing
officials
to
confirm
their
treatment
of
interested
party
contributions
(IPCs)
to
home
purchase
transactions.

In

a
letter
addressed
to


Federal
Housing
Finance
Agency
(FHFA)
director

Sandra
Thompson,


Fannie
Mae
CEO
Priscilla
Almodovar,


Freddie
Mac
CEO
Michael
DeVito,
and


Federal
Housing
Administration
(FHA)
commissioner
Julia
Gordon
on
Wednesday,
the
NAR
and
MBA
wrote
that
it
was
important
for
the
agencies
and
government-sponsored
enterprises
(GSEs)
to
review
NAR’s

commission
lawsuit

settlement
agreement.

They
asked
the
federal
officials
to
“provide
guidance
to
market
participants
that
will
ensure
these
new
arrangements
will
continue
to
be
supported
by”
FHA
and
GSE
underwriting
standards.

At
the
moment,
IPCs
“include
concessions
from
the
seller
to
the
buyer
for
items
that
are
traditionally
paid
by
the
buyer
such
as
loan
closing
costs
or
rate
buy-downs,”
but
as
buyer
agents
are
customarily
paid
by
the
listing
agent,
their
fees
are
excluded
from
caps
on
the
IPCs.

Under
existing
FHA
policy,
for
example,
if
sellers
continue
to
pay
buyer-side
real
estate
agent
commissions
and
fees
as
a
matter
of
state
or
local
laws
or
customs
—
and
if
the
commissions
and
fees
are
reasonable
in
amount
—
these
payments
would
not
be
treated
as
interested
party
contributions
provided
all
other
requirements
are
met.

Under
the
terms
of
NAR’s
settlement
agreement,
the
practice
of
cooperative
compensation
is
still
allowed,
but
it
cannot
be
offered
through
a
Multiple
Listing
Service
(MLS).
Sellers
or
buyers
can
pay
the
buyer’s
agent’s
fees.

“Consequently,
once
the
settlement
is
in
effect,
we
believe
that
FHA
and
GSE
policy
should
continue
to
exclude
seller
or
listing
agent
payment
of
buyer
agents’
commission
from
IPCs,”
the
NAR
and
MBA
wrote.
“Confirming
your
policies
and
maintaining
this
practice
will
sustain
the
current
flow
of
mortgage
capital
to
home
buyers
without
change
or
delay.”

The
two
trade
organizations
urge
federal
officials
to
provides
this
certainty
now,
as
they
feel
it
is
needed
“to
prevent
disruptions
that
may
cost
homebuyers
and
sellers
money
and
potentially
their
home
purchases.”

NAR
also
sent

a
letter
to
the


U.S.
Department
of
Veteran
Affairs (VA)
on
Wednesday,
urging
it
to
revise
policies
that
prohibit
veterans
from
paying
buyer
broker
commissions.

The
current
VA
rule
states
that
a
borrower
using
a
VA
loan
cannot
pay
fees
or
commissions
to
a
real
estate
agent
unless
determined
“by
the
Under
Secretary
for
Benefits
as
appropriate
for
inclusion
…
as
proper
local
variances.”

NAR
told
John
Bell,
the
executive
director
of
VA’s
Loan
Guaranty
Service,
that
the
current
policy
would
put
VA
buyers
at
a
disadvantage,
as
they
would
potentially
be
forced
to
forego
professional
representation.

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