What is the primary purpose of the Real Estate Settlement Procedures Act (RESPA)?

• A. To require disclosures about closing costs to borrowers
• B. To set interest rates
• C. To regulate appraisal standards
• D. To govern property taxes

Answer: (A)

RESPA focuses on transparency for homebuyers in the settlement process. Its main purpose is to require disclosures about closing costs to borrowers, so they can clearly see what they’ll pay and compare offers, reducing surprise charges and the potential for kickbacks or referral fees that could inflate costs. This emphasis on clear, early cost disclosures is what makes it the best answer. The other options aren’t the act’s aim: interest rates are determined by lenders and market forces, appraisal standards are governed by separate appraisal regulations and standards, and property taxes are set by local government authorities.