Keller Williams Ignite Practice Exam

Real Estate Settlement Procedures Act is a federal law that protects homebuyers by making settlement costs transparent and fair. It requires disclosure of closing costs so borrowers can compare and understand what they will pay, and it prohibits kickbacks and certain fee arrangements that could inflate costs. RESPA also promotes transparency in the settlement process by requiring clear disclosures about how fees are charged and about any relationships with affiliated service providers.

The other statements miss key aspects: one misnames the act and incorrectly says it standardizes appraisals; another misstates its purpose as preventing foreclosure; and another wrongly claims it bans all closing cost disclosures.