Mometrix Test Preparation NMLS Study Guide 2024-2025

Front

What does RESPA stand for?

Back

Real Estate Settlement Procedures Act

Front

In what year was RESPA enacted by the government?

Back

1974

Front

What was RESPA designed for?

Back

It was designed to protect consumers by making real estate transactions transparent and fair.

Front

What does RESPA require?

Back

The law requires lenders to clearly disclose to buyers and sellers all of the costs involved in a real estate transaction.

Front

What does RESPA also attempt to do?

Back

The law requires lenders to educate consumers about their consumer protection rights. it also gives consumers recourse in the event they believe a lender has treated them unfairly.

Front

Mortgage broker

Back

Like a matchmaker that connects borrowers to lenders, and mortgage brokers also get paid a fee after matching borrowers with lenders.

Front

What does RESPA prohibit?

Back

It prohibits kickbacks, unearned fees or payments, and excessive escrow requirements. It also prohibits sellers from requiring buyers to use certain settlement service providers as a stipulation to the sales agreement.

Front

unimproved property

Back

land that does not have basic services like electricity, sewers, road access, phone lines, or water service

Front

Bridge or swing loans

Back

A short-term loan used to buy a house then pay off the loan with the proceeds from the sale of another home

Front

Modification

Back

When a lender agrees to modify the terms of an existing mortgage in order to lower the payment