Finance
Under RESPA, a real estate licensee who accepts a fee for referring a buyer to a title company would be:
APermitted if the fee is under $500
BViolating RESPA's anti-kickback provision, which prohibits unearned referral fees✓ Correct
CActing legally as long as it is disclosed on the Closing Disclosure
DRequired to split the fee with the buyer
Explanation
RESPA Section 8 prohibits giving or receiving any fee, kickback, or thing of value in exchange for referrals of settlement service business. Accepting a referral fee from a title company without providing actual services is an illegal kickback regardless of disclosure.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
State-Specific Concepts
Disclosure Requirements
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