In what appears to be a coup for the National Association of Realtors, a policy originally slated to take effect on Oct. 1 banning real estate agents and brokers from representing both a buyer and a seller in an FHA short-sale transaction has been postponed.

The U.S. Department of Housing and Urban Development (HUD) issued a letter to mortgage servicers in July outlining a number of new anti-fraud requirements for short sales and deeds-in-lieu of foreclosure, including policies to ensure “arm’s length” transactions.

One of these policies said “brokers and their agents may only represent the buyer or the seller, but not both parties,” effectively prohibiting what industry participants commonly refer to as “dual agency.”

Last week, the NAR sent a letter to HUD urging the federal agency to reconsider implementing the policy, saying it could make it harder for the government to get top dollar on short sales if some brokerages decided not to represent sellers in FHA short sales because they would not want to restrict their agents from representing buyers of those properties.

The trade group also complained that the policy could conflict with some state licensing laws and multiple listing service guideline

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