The Real Estate Settlement Procedures Act (RESPA) is designed to protect borrowers from what?

The Real Estate Settlement Procedures Act (RESPA) is primarily focused on protecting borrowers from excessive settlement costs and ensuring they receive clear and accurate information regarding the costs associated with real estate transactions. By addressing these issues, RESPA seeks to prevent borrowers from paying too much for credit, which includes both fees associated with the loan and other related costs during the settlement process.

The overall aim of RESPA is to promote transparency and fairness within the home financing process, thereby helping consumers to make more informed decisions. This regulation requires lenders to provide borrowers with a Good Faith Estimate of the settlement costs, allowing them to compare fees between different lenders and understand what they will be required to pay at closing. This aligns directly with enhancing borrower protection against inflated costs associated with securing a mortgage.