Understanding Recent Clarifications on Mortgage Commission Rules

Lisa Mailhot  |  April 22, 2024


Understanding Recent Clarifications on Mortgage Commission Rules


In the ever-evolving landscape of real estate, understanding the subtleties of mortgage rules and commission payments can be crucial for both buyers and sellers. Recent guidance from Fannie Mae and Freddie Mac has reaffirmed that sellers can continue to pay buyer's agents' commissions without it counting as a concession. This article delves into these clarifications and what they truly mean for the real estate market.

Clarifications on Commission Payments

During a recent announcement, representatives from Fannie Mae and Freddie Mac clarified important aspects regarding the payment of buyer’s agent commissions. This guidance comes amidst widespread speculation and misconceptions following a proposed settlement that could alter the longstanding practices of how agents are compensated.

The Core of the Guidance

The key takeaway from the recent bulletins is that payments made by sellers to buyer’s agents will not be considered seller concessions. This means these payments do not count towards the cap on "interested party contributions" (IPCs), which are typically limited to between 2% and 9% of the property’s value depending on various factors. Importantly, this preserves the traditional method of compensating buyer's agents without additional financial implications for the seller or buyer under current guidelines.


The Implications for Sellers and Buyers

This clarification ensures that the existing system of commission payments remains intact, allowing sellers to continue incentivizing buyers' agents through traditional channels. It provides stability and predictability in how commissions are handled, ensuring that there are no sudden shifts in financial responsibilities when closing deals.

Future of Commission Structures

While the clarifications confirm the status quo, there is ongoing discussion about potentially "decoupling" commissions. This would mean that buyers might negotiate and directly pay their agent's fees, shifting away from the seller-paid commission model. This proposed change is part of broader industry reflections on enhancing transparency and fairness in real estate transactions. Although these discussions signal possible future changes, the current practices as clarified by Fannie Mae and Freddie Mac remain unchanged, and it is this current guidance that remains our focus today.


As the real estate industry continues to adapt and evolve, understanding the nuances of these regulatory clarifications is more important than ever. For those considering a move or investment in real estate, staying informed about these changes is crucial. If you're looking to navigate the complexities of buying or selling a home with ease, let's connect and make your real estate journey a success.



Reference: Carter, M. (2024, April 22). Lamacchia: 'Nothing's changed' about mortgage commission rules. Inman. Retrieved April 22, 2024.

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