What is the primary focus of the Real Estate Settlement Procedures Act (RESPA)?

The primary focus of the Real Estate Settlement Procedures Act (RESPA) is to require disclosures about mortgage and settlement processes. RESPA was enacted to provide consumers with better information regarding the costs associated with the settlement process when buying a home. It aims to ensure that borrowers are informed about the various fees and charges they will encounter during the purchase of real estate, thereby preventing abuses and unilateral decisions by lenders and settlement service providers.

This act necessitates that lenders provide a Good Faith Estimate of closing costs, ensuring that borrowers are aware of what to expect financially before they complete the settlement process. Additionally, RESPA addresses the issue of kickbacks and referral fees that may inflate settlement costs, promoting transparency and fairness in the real estate transaction process.

In contrast, establishing mortgage interest rates, regulating the actions of real estate agents, and dictating terms of leasing agreements are not the main objectives of RESPA. These aspects fall under different regulations and practices within the real estate and lending sectors.