Escrow & Title

Under RESPA, which of the following is prohibited?

ACharging a reasonable title insurance premium
BPaying a kickback or referral fee for the referral of settlement service business✓ Correct
CRequiring impound accounts for taxes and insurance
DProviding a good faith estimate of closing costs

Explanation

RESPA prohibits kickbacks and unearned fees in connection with federally related mortgage transactions. Paying or receiving referral fees for settlement services (such as title insurance, escrow, or appraisal) is illegal under Section 8 of RESPA.

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