NAR Settlement: A 10-Point Guide for Home Buyers and Sellers
Introduction
I wrote this 10-point guide, and my team and I are here, to make your experience a breeze. We’re happy to answer all your questions so that you can move forward comfortably and confidently in your next home purchase or sale.
A REALTOR’s® Value
The National Association of REALTORS® details an extensive list of services provided by Realtors® who work for their clients. These lists outline 179 ways Realtors® bring value to home buyers and sellers and an additional 105 ways Realtors® bring value to home buyers.
These comprehensive lists highlight the dedication, hard work, and expertise that REALTORS® bring to a real estate transaction. As a result, home buyers and sellers receive maximum value and support from initial consultation though closing.
Three Key Changes for Both Home Buyers and Sellers
1. Transparency
The NAR Settlement ensures greater transparency in, and reinforces the negotiability of, the professional compensation that buyers and sellers are paying for broker and agent professional services.
2. Negotiable Broker Fees
Broker and agent professional compensation and fees are fully negotiable. Home buyers and sellers should have clear discussions with their agents about compensation to understand the full range of choices available.
3. Professional Compensation Disclosure
The NAR Settlement requires that broker agreements include a specific disclosure of the broker’s and agent’s professional compensation. This disclosure must be clear, objective, and not open-ended.
As a result, home buyers and seller are fully aware of the costs involved in their transaction from the very start of the buying or selling process.
Two Additional Key Changes for Home Buyers
4. Buyer Broker Agreement
The NAR Settlement requires that homebuyers sign a written agreement with their broker and agent before touring a home. This agreement should clearly outline the terms negotiated with the broker and agent. It should include the services that will be provided and the professional compensation the broker and agent will receive.
5. Buyer Broker and Agent Professional Compensation
Buyer’s brokers and agents may be compensated for their professional services in a number of ways. They include:
- Seller compensation of the buyer’s broker and agent directly.
- Seller compensation of the buyer’s broker and agent through seller concessions to the buyer.
- Buyer compensation of the buyer’s broker and agent directly.
- Any combination thereof.
In any case, the buyer’s broker and agent may not receive compensation that exceeds that agreed upon between the buyer and his broker and agent.
Two Additional Key Changes for Home Sellers
6. Disclosure of Professional Compensation
The NAR Settlement requires that brokers and their agents more fully disclose to home sellers any payment or offer of professional compensation to another broker and agent acting for buyers.
This disclosure must be made in writing, specify the amount or rate of payment, and be signed by the home sellers.
7. Advertising Listings and Compensation
Professional compensation offered to brokers and agents for bringing a buyer who closes the transaction may not be included in a Multiple Listing Service (MLS) effective August 17, 2024.
Brokers and agents may still advertise professional compensation offered to a buyer’s broker and agent through off-MLS platforms such as social media, websites, and yard signs, to name a few.
Three Key Items the NAR Settlement Left Unchanged
8. Professional Compensation to Buyer Brokers
Home sellers will continue to have the option to offer professional compensation to a buyer’s broker and agent for bringing a buyer who closes the transaction.
9. Seller Concessions to a Buyer
Sellers may still offer, and buyers may accept, seller concessions. Buyers may still request concessions as part of their offer and negotiations with the seller.
10. Ethical Obligations of REALTORS®
Most importantly, under the NAR Settlement, REALTORS® continue to be ethically obligated to work in the best interest of home sellers.
REALTORS® must continue abide by the REALTOR® Code of Ethics, ensuring transparent and honest dealings. That includes clear disclosure of our professional compensation, and clear and competent guidance throughout the home selling process.
Commentary on Buyer Affordability
Buyers typically have little extra cash, after their downpayment and closing costs, to compensate their broker and agent directly. Current conforming loan requirements do not permit the buyer to add that expense to their mortgage loan.
When the seller offers compensation to a buyer’s broker, as has been customary in the US residential real estate market, that expense is included in the price of the home. In this way, the professional compensation paid to a buyer’s broker and agent is included in buyers’ mortgage loan.
We believe that sellers continuing to offer professional compensation directly to a buyer’s broker and agent is the best way to attract the greatest number of prospective buyers to see the home and, thusly, the best contract terms possible.
About Jean Scott Homes
Our Experience and Service
At Jean Scott Homes, we bring years of experience and a deep understanding of the real estate market. Our team is dedicated to providing exceptional service to home buyers and sellers as we adapt to the changes that the NAR Settlement brings to our industry. We will continue to put you, our clients’ interests first.
Client Reviews
Our clients consistently praise our commitment to excellence and our ability to navigate complex transactions smoothly. That’s evident in the 200+ Google, 5-star reviews provided by our past clients. We take pride in our positive reviews and place high value in the trust our clients place in us.
Dedication to Win-Win Transactions
We are committed to helping home buyers and sellers come together in transactions that are beneficial for both parties. Our goal is to ensure a smooth and successful real estate experience for everyone involved.
Conclusion
In conclusion, the NAR Settlement is reshaping the real estate landscape, offering more clarity and flexibility to consumers buying and selling a home.
Jean Scott Homes embraces these changes, upholding our promise to assist home buyers and sellers in achieving their real estate goals and maximizing the investment.
For more information on how we can help you navigate this new environment, please call or text us today at 407-564-2758 or fill out the form below and we will be in touch!
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