Finance
The Real Estate Settlement Procedures Act (RESPA) prohibits which of the following in residential mortgage transactions?
ACharging origination fees
BKickbacks and unearned referral fees between settlement service providers✓ Correct
CRequiring escrow accounts for taxes and insurance
DCharging discount points
Explanation
RESPA Section 8 prohibits kickbacks and fee-splitting arrangements between settlement service providers (e.g., lenders paying referral fees to real estate agents) for federally related mortgage loans.
Related California Finance Questions
- The Truth in Lending Act (TILA) requires lenders to disclose the:
- A 'due-on-sale clause' in a mortgage means:
- What is a 'conforming loan'?
- Which loan program is specifically designed to help veterans purchase homes with no down payment requirement?
- What is 'equity' in real estate?
- A purchase-money mortgage is:
- What does it mean when a mortgage has a 'prepayment penalty'?
- What is private mortgage insurance (PMI) and when is it typically required?
Practice More California Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free California Quiz →