NAR Supports USDA Proposed Rule Excluding Real Estate Commission Fees from Seller Concession Cap

NAR recently submitted comments supporting a USDA proposal that would exclude real estate commission fees from the cap on seller contributions in its Single Family Housing Guaranteed Loan Program, which backs home loans for low- and moderate-income buyers in rural areas.

Under the program, a seller is permitted to contribute up to six percent of the sales price toward a buyer's closing costs, escrow, and other expenses. Real estate commission fees that a seller pays on the buyer's behalf used to count against that limit. in 2025, USDA updated its policy through its loan handbook and administrative exception authority to exclude these fees from the cap, and is now making that update permanent by writing it into the regulation.

FHA, Fannie Mae, and Freddie Mac have all made similar changes, treating commission fees that sellers customarily pay as separate from other seller contributions rather than counting them against borrower assistance limits. USDA's proposed rule brings its program in line with that approach.

Professional buyer representation plays an especially important role for rural homebuyers, many of whom are first-time purchasers navigating a complex transaction with limited financial flexibility. USDA's decision to exclude buyer broker fees from the seller concession cap will help preserve access to that representation while ensuring that limited seller concessions remain available to address borrowers' other transaction-related costs.

Comments on the proposed rule are due June 22, 2026.