November 1, 2011
FHA loans, like other mortgage transactions, are governed by a set of regulations including the Real Estate Settlement Procedures Act or RESPA.
According to the official site at FHA.gov, “The Real Estate Settlement Procedures Act (RESPA) insures that consumers throughout the nation are provided with more helpful information about the cost of the mortgage settlement and protected from unnecessarily high settlement charges caused by certain abusive practices.”
Borrowers who suspect those abusive practices have been used in their FHA home loan transactions (and/or conventional loans) are urged to report such problems. But where does the borrower start? What areas of the FHA loan transaction are governed by RESPA?
According to the FHA, “RESPA is about closing costs and settlement procedures. RESPA requires that consumers receive disclosures at various times in the transaction and outlaws kickbacks that increase the cost of settlement services. RESPA is a HUD consumer protection statute designed to help homebuyers be better shoppers in the home buying process, and is enforced by HUD.”
But the website has since been updated to include new contact information for those who need to make a RESPA-related complaint. In July 2011, HUD made an announcement stating, “the Real Estate Settlement Procedures Act (RESPA) will be administered and enforced by the Consumer Financial Protection Bureau (CFPB). If you are a consumer with a question or complaint related to your mortgage or mortgage servicer, please contact the CFPB
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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