A federal law requiring mortgage lenders to give potential borrowers a government publication describing the closing process and providing clear, advance disclosure of all closing costs to home buyers is called:
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A. B. C. D.B
The federal law requiring mortgage lenders to give potential borrowers a government publication describing the closing process and providing clear, advance disclosure of all closing costs to home buyers is called the Real Estate Settlement Procedures Act (RESPA).
RESPA is a consumer protection law that was enacted by the U.S. Congress in 1974. Its purpose is to ensure that home buyers are provided with accurate and timely information about the costs associated with buying a home and the services that are involved in the real estate settlement process.
RESPA requires that mortgage lenders provide borrowers with a special information booklet called the "Special Information Booklet: Settlement Costs" or the "Home Buyer's Guide to Settlement Costs". This booklet outlines the entire settlement process and provides clear and concise information about the various costs that home buyers can expect to pay during the closing process, such as loan origination fees, title insurance, and escrow payments.
In addition to providing borrowers with the special information booklet, RESPA also requires lenders to provide borrowers with a "Good Faith Estimate" of the closing costs associated with their mortgage loan. This estimate must be provided to the borrower within three days of receiving their loan application and must be in writing.
Overall, RESPA is an important federal law that helps to protect home buyers by ensuring that they have access to clear and accurate information about the costs associated with buying a home and the services that are involved in the real estate settlement process.