Escrow & Title
RESPA prohibits Wisconsin lenders from requiring borrowers to use a specific:
AReal estate agent
BTitle insurance company as a condition of loan approval✓ Correct
CAppraiser chosen by the buyer
DHome inspector
Explanation
RESPA prohibits lenders from requiring borrowers to use a particular title insurance company as a condition of obtaining a loan.
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Key Terms to Know
Title Insurance
Insurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Short SaleA sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
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