What is the primary purpose of RESPA?

The primary purpose of the Real Estate Settlement Procedures Act (RESPA) is to standardize lending practices. This federal law was enacted to help consumers understand the costs associated with their mortgage loans and to protect them from unnecessarily high settlement charges. It requires lenders to provide borrowers with clear and detailed information about the loan process, including the disclosure of known or anticipated settlement costs and the timeline for closing. By establishing these guidelines, RESPA ensures that consumers are well-informed and able to make educated decisions when navigating the home-buying process.

Standardization of lending practices helps create consistency across the industry, which benefits both lenders and borrowers by alleviating confusion and promoting transparency. The other options mentioned do not capture the intent of RESPA as accurately and focus on specific aspects that may not encompass the broader objective of the legislation.