9 Things To Know About Real Estate Settlement Procedures Act (RESPA)
The real estate settlement procedures act (RESPA) was passed in 1974.
It’s a consumer protection stature.
Its purpose is to help consumers become better shoppers for settlement services and to eliminate kickbacks and referrals fees that unnecessarily increase the costs of certain settlement service.
Its main focus is on closing cost and settlement procedures.
It covers loans for one to four family homes, assumptions, refinances, property improvement loans and equity lines of credit.
It ensures that consumers throughout the United States are provided with helpful information about the cost of their mortgage.
In addition, it protects them from unnecessarily high settlement charges caused by abusive practices.
RESPA requires that consumers receive disclosures at various times during the mortgage loan process. 3 days after you submit your mortgage application and 3 days before closing.
It also aims to make mortgage financing clearer and cheaper for consumers.
RESPA makes it so consumers receive mortgage related disclosure in advance of making key decisions, so they will have time to process the information before signing, should they choose to move forward.
RESPA became effective on June 20, 1975. Since then, It has gone through a fair number of changes and amendments, all with the intent of helping to inform consumers of the mortgage loan settlement costs.
We at First Home Houston is always looking out for your best real estate interest. As always, we thank you for stopping by. Until next time… Diana.
