Escrow & Title
Under RESPA, which of the following is a prohibited referral arrangement in Iowa real estate?
AA broker referring clients to a title company and earning a fee for services actually performed
BA lender requiring borrowers to use an affiliated title company without disclosure✓ Correct
CA buyer choosing their own title company
DA cooperative compensation arrangement between brokerages
Explanation
RESPA prohibits referral fee arrangements and undisclosed affiliated business arrangements. A lender requiring borrowers to use an affiliated title company without proper RESPA disclosure violates Section 8 of RESPA.
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