V.A. Loans Don’t Cover Commissions. How Will Veterans Afford New Fees?

A recent landmark settlement that could significantly change how real estate agents are paid could also have an adverse effect on a sector of potential home buyers who often rely on government-backed mortgages: military veterans.

The National Association of Realtors agreed to change its rules to settle a multitude of legal claims from home sellers who argued that the trade group’s policy on commissions forced them to pay excessive fees.

But there are also concerns that veterans will now opt to go unrepresented at the bargaining table because the Veterans Affairs loan prevents them from paying a commission to a buyer agent.

What is the Veteran Affairs loan?

The Veterans Affairs loan, or V.A. loan, is a privately funded mortgage backed by the U.S. Department of Veterans Affairs that is best known for allowing veterans to purchase a home with no down payment. The loan was created in 1944 as part of the G.I. Bill of Rights, and it often comes with unwarranted stigma — they were once considered more complicated and harder to close than conventional loans, but the process has long been streamlined, with many of the bureaucratic hurdles that sellers worried about having long been eliminated.

About 28 million military veterans have used the loan since 1944.

What does the V.A. loan say about agent commissions?

One of the rules of the V.A. loan is that borrowers who use it aren’t allowed to pay commission to their real estate agents when buying a home — a mandate designed to shield them from additional costs. And until the N.A.R. settlement, this was rarely an issue, because of how commissions have long been paid: In the United States, most agents specify a commission of 5 or 6 percent, paid by the seller. If the buyer has an agent, the seller’s agent agrees to share a portion of the commission with that agent when listing the home on the market.

But when the N.A.R. settlement goes into effect in July, pending a judge’s approval, those offers of commission are likely to go away, thanks to changes to a key rule that a jury decided was anticompetitive. And without seller agents splitting their commission with buyer agents, buyers who use a real estate agent will now be expected to pick up the bill for their own agents’ services.