RESPA (Real Estate Settlement Procedures Act)
A federal law that governs disclosures in residential mortgage settlements and prohibits kickbacks and unearned fees.
The Real Estate Settlement Procedures Act is a federal law that applies to most residential mortgage loans. It requires lenders to give borrowers disclosures about settlement costs and, under Section 8, prohibits kickbacks, referral fees, and unearned fees among settlement service providers.
Under the integrated federal disclosure rules, the creditor generally must deliver or mail the Loan Estimate no later than three business days after application. The consumer generally must receive the Closing Disclosure at least three business days before consummation.
On the exam
Exam trap
Tested in
Financing & Settlement (6% of the exam)
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This definition is Texas real estate exam-prep education, not legal, tax, or professional advice. Verify current rules against the official source before relying on them for a real transaction. Back to the full glossary.