The Real Estate Settlement Procedures Act (RESPA) requires what kind of disclosure?

The Real Estate Settlement Procedures Act (RESPA) requires what kind of disclosure?

• A. Only APR disclosure
• B. Disclosure of closing costs
• C. Disclosure of borrower’s credit score
• D. Disclosure of property taxes

Answer: (B)

The Real Estate Settlement Procedures Act (RESPA) primarily mandates that lenders provide borrowers with clear and concise information regarding the costs associated with their real estate transactions. This includes the requirement for disclosure of closing costs, which encompasses various fees related to the mortgage and the closing process. The aim of this requirement is to promote transparency and help consumers understand the various charges they will incur, preventing any surprises at closing. By obligating lenders to disclose closing costs, RESPA ensures that borrowers can make informed decisions about their loans and understand the overall financial commitment involved in purchasing or refinancing a property. This disclosure enhances consumer protections and promotes fair lending practices. Hence, the emphasis on closing costs aligns with the core purpose of RESPA to safeguard the interests of consumers in real estate transactions.

The Real Estate Settlement Procedures Act (RESPA) primarily mandates that lenders provide borrowers with clear and concise information regarding the costs associated with their real estate transactions. This includes the requirement for disclosure of closing costs, which encompasses various fees related to the mortgage and the closing process. The aim of this requirement is to promote transparency and help consumers understand the various charges they will incur, preventing any surprises at closing.

By obligating lenders to disclose closing costs, RESPA ensures that borrowers can make informed decisions about their loans and understand the overall financial commitment involved in purchasing or refinancing a property. This disclosure enhances consumer protections and promotes fair lending practices. Hence, the emphasis on closing costs aligns with the core purpose of RESPA to safeguard the interests of consumers in real estate transactions.