Escrow & Title
What is a 'RESPA' violation and what type of penalties can result in Illinois real estate transactions?
AViolation of the Real Estate Survey and Plat Act; results in recording delays
BViolation of the Real Estate Settlement Procedures Act; can result in criminal and civil penalties including treble damages✓ Correct
CViolation of the Real Estate Sales Practices Act; requires refund of buyer deposits
DViolation of IDFPR rules; results in license suspension only
Explanation
RESPA (Real Estate Settlement Procedures Act) is a federal law governing the mortgage lending and settlement process. Violations (such as kickbacks, unearned fees, or improper use of escrow accounts) can result in serious consequences: criminal penalties of up to $10,000 fine and 1 year imprisonment for kickbacks, and civil liability for treble damages to borrowers. RESPA violations are taken seriously by HUD and DOJ.
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