What does RESPA stand for?

RESPA stands for the Real Estate Settlement Procedures Act. This federal legislation was enacted to provide consumers with information about the costs associated with real estate transactions and to protect them from abusive practices during the settlement process.

RESPA aims to ensure that consumers receive appropriate disclosures regarding the transaction and that they understand the various fees and charges involved. It also addresses issues related to kickbacks and referral fees that might affect the cost of settlement services. The act promotes transparency and fairness in real estate settlements, making it crucial for agents, lenders, and other parties in the real estate process to adhere to its guidelines. Understanding RESPA is essential for a real estate professional, as compliance with its provisions is a key aspect of ethical practice in the industry.