Real Estate Settlement Procedures Act
People also ask
What is RESPA and how does it affect real estate agents?
Under RESPA, settlement providers (real estate agents, lenders, escrow agents, title companies, etc.) are required to make disclosures about the costs of the services rendered, relationships between the businesses involved, and applicable consumer protection laws. Plus, it prohibits kickbacks and other similar practices.
What is a RESPA loan?
From its inception, RESPA has regulated mortgage loans attached to one-to-four family residential properties. The objective of RESPA is to educate borrowers regarding their settlement costs and to eliminate kickback practices and referral fees that can inflate the cost of obtaining a mortgage.
What is RESPA and when did it start?
Originally passed by Congress in 1974, the Real Estate Settlement Procedures Act became effective on June 20, 1975. RESPA has been impacted over the years by several changes and amendments.
Does RESPA apply to vacant land?
Vacant land: If a loan is secured by vacant land and no structures are built on it within two years, RESPA does not apply. Assumptions without lender approval: If a mortgage is transferred (assumed) from one borrower to another without the approval of the lender, RESPA does not apply.