Understanding the Impact of Updated Fannie Mae Guidelines and FHA FAQs on Seller-Paid Commissions
Did You Know?
According to the updated Fannie Mae Guidelines, when a seller or the seller’s real estate agent continues to pay the buyer’s real estate agent commission according to local practices, these amounts do not need to be counted towards the Interested Party Contribution (IPC) limits for the transaction.
FAQs on Seller-Paid Commissions and NAR Settlement
The Federal Housing Administration (FHA) has published Frequently Asked Questions (FAQs) addressing inquiries related to the nationwide settlement agreement proposed by the National Association of REALTORS® (NAR). Since the announcement, stakeholders have questioned how this settlement will impact seller-paid buyer real estate broker fees in transactions using FHA-insured mortgage financing.
Key Points:
– Under existing FHA policy, if seller-paid commissions and fees are in line with state and local laws or customs and are reasonable, they are not treated as interested party contributions, provided all other requirements are met.
– FHA will monitor the real estate market for changes resulting from the settlement and will address additional questions as they arise.
These clarifications help ensure transparency and understanding for those involved in real estate transactions, maintaining compliance with FHA policies and the new Fannie Mae guidelines.
Links to the guidelines from Fannie Mae, Freddie Mac, and FHA for your lenders: