Which action is prohibited under RESPA?

The action that is prohibited under the Real Estate Settlement Procedures Act (RESPA) is the payment of kickbacks. RESPA was established to protect consumers in the real estate settlement process by ensuring transparency and fairness. It specifically prohibits paying or receiving kickbacks or referral fees for services related to real estate transactions. This means that if a real estate professional receives a payment for referring a client to another service provider, such as a title company or mortgage lender, without doing any actual work of value for that payment, it is considered a violation of RESPA.

The intent behind this prohibition is to prevent unethical practices that can inflate costs and lead to conflicts of interest, ultimately harming consumers by driving up the price of real estate transactions. All parties engaged in real estate transactions need to be especially diligent about following these regulations to avoid legal repercussions.

In the context of the other actions listed, while blockbusting, redlining, and steering are also illegal practices that can lead to discriminatory outcomes in housing, they are primarily addressed under the Fair Housing Act rather than RESPA. Understanding the specific regulatory frameworks that govern these various issues is crucial for real estate professionals operating in Hawaii and beyond.