New guidelines set to go into effect this July from the National Association of Realtors settlement could mitigate the use of buyer agents, as sellers won't have to offer them compensation on Multiple Listing Services. While parties can still negotiate fees, and the traditional comp model may remain in place, industry leaders are wary of new rules clashing with federal underwriting standards.

The Federal Housing Administration answered some of those concerns Thursday, as it addressed questions from an open letter Wednesday by NAR and the Mortgage Bankers Association. Under FHA guidelines, buy-side commissions are excluded from caps on interested party contributions, in which concessions such as loan closing costs and rate buydowns fall under. 

"If sellers continue to pay buyer-side real estate agent commissions and fees…and if the commissions and fees are reasonable in amount, existing policy would not treat those payments as interested party contributions provided all other requirements are met," the FHA said. 

Another question remains regarding Department of Veterans Affairs-backed originations, in which buyers cannot pay their "professional representative" directly. In separate letters this week, NAR and the Community Home Lenders of America asked the regulator to expedite a policy change to address situations in which a seller won't pay a VA buyer's agent commission.

"VA buyers are immediately at a disadvantage, potentially forcing them to forego professional representation, lose a property in an already limited inventory, choose a different loan product, or exit the market entirely," wrote NAR President Kevin Sears in a letter to John Bell, executive director, Loan Guaranty Service, at the VA. 

The VA is working with the Department of Justice to review the implications of the NAR settlement, a spokesperson said Thursday. 

The Federal Housing Finance Agency and other federal housing stakeholders meanwhile have been largely mum on the topic since NAR made its announcement March 15. Industry veterans and analysts have suggested federal lawmakers could address protections for VA and other impacted buyers ahead of the rule changes. 

NAR's massive $418 million settlement with home buyers, which also covers the organization's member-owned brokerages with transactional volume of $2 billion or less in 2022, is pending a federal judge's approval. Federal law enforcement intervention also remains a possibility, as the DOJ could weigh in on NAR's proposed settlement.