Question

Which of the following is required by the Real Estate Settlement Procedure Act (RESPA)?

a. The disclosure of any credit bareau that was used to obtain credit reports which were used as the basis for a loan approval or denial
b. that real estate brokers do not discriminate in the sale or rental of real estate
c. that developers who are offering lots for sale across state lines be properly registered and make appropriate disclosure
d. that borrowers be informed of all settlement costs involved in the purchase of a home when funds are obtained from a federally regulated lender.

Answer 1

The Real Estate Settlement Procedures Act (RESPA) requires federally regulated lenders to disclose all settlement costs to borrowers when purchasing a home. It includes providing Good Faith Estimates and HUD-1 Settlement Statements, and it also prohibits certain practices that would increase settlement service costs.

Step-by-step explanation:

The Real Estate Settlement Procedures Act (RESPA) requires disclosure of all settlement costs involved in the purchase of a home when funds are obtained from a federally regulated lender. This includes providing borrowers with a Good Faith Estimate of settlement costs early in the process and a HUD-1 Settlement Statement at closing. RESPA aims to help consumers become better shoppers for settlement services and to eliminate kickbacks and referral fees that unnecessarily increase the costs of certain settlement services.

RESPA also includes other provisions to protect consumers, such as prohibiting lenders from demanding excessively large escrow accounts and ensuring that borrowers are given advance notice before their loans are assigned, sold, or transferred. Additionally, RESPA enforces timely payment by the loan servicer of taxes and insurance.