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Reviewed by Casa Academy and updated July 29, 2026 using the current DBPR checklist and Pearson VUE scheduling guidance.

Real Estate Settlement Procedures Act

The Real Estate Settlement Procedures Act (RESPA) is a federal law administered by the Consumer Financial Protection Bureau that requires timely loan cost disclosures, limits kickbacks and unearned fees in settlement services, and governs escrow account practices on federally related mortgage loans.

Exam context

RESPA requires Loan Estimate and Closing Disclosure on federally related mortgages. Section 8 prohibits kickbacks and unearned referral fees. Affiliated business arrangements need disclosure.

Disclosure requirements

Lenders must provide a Loan Estimate within three business days of application and a Closing Disclosure at least three business days before consummation on most closed-end residential loans. RESPA also requires servicers to respond to qualified written requests and follow escrow accounting rules.

Section 8 prohibitions

RESPA Section 8 bans kickbacks, fee splitting, and unearned fees among settlement service providers. Referral fees between agents and title companies without disclosed value are violations. Affiliated business arrangements require written disclosure and choice for consumers. License exams heavily test RESPA alongside fair lending laws.

Examples

  • Closing Disclosure timing

    A lender delivers the Closing Disclosure four business days before signing so the borrower can review fees and compare them to the Loan Estimate under TRID/RESPA rules.

  • Illegal referral fee

    A mortgage broker pays a real estate agent $500 per closed loan without disclosed services. Regulators treat this as a RESPA kickback violation.

Keep studying

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