Loan Officer Practice Exam

Which regulation implements RESPA?

1. Regulation B

2. Regulation Z

3. Regulation H

4. Regulation X

The correct answer is: Regulation X

The correct choice for the regulation that implements the Real Estate Settlement Procedures Act (RESPA) is Regulation X. This regulation was established to provide consumers with information about the nature and costs of the settlement process, ensuring transparency in real estate transactions. It requires lenders to disclose certain key information, such as the Good Faith Estimate and the HUD-1 Settlement Statement, which detail the costs a borrower can expect to incur at closing. Regulation X also addresses practices associated with mortgage servicing and the handling of escrow accounts, which are vital for consumer protection and the proper management of real estate transactions. By ensuring these disclosures and protections are in place, Regulation X helps borrowers make informed decisions when purchasing or refinancing a home. In contrast, other regulations address different aspects of lending and consumer protection and do not directly implement RESPA. For example, Regulation B pertains to the Equal Credit Opportunity Act, focusing on eliminating discrimination in credit transactions. Regulation Z implements the Truth in Lending Act, which governs the disclosure of credit costs and terms. Regulation H applies to the Housing and Urban Development Act, but is not the specific regulation that encompasses RESPA.