©EMILLECT 2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED
FIRST PUBLISH OCTOBER 2024
RESPA Exam Study Guide Solutions
RESPA origins and purpose - ANSWER✔✔-1974
To allow consumers:
-to obtain information on the cost of closing services
-protect consumes from excessive settlement costs and unearned fees.
Only fees for services performed and
No Unearned fees or Fee splitting (kickbacks)
Mortgage Broker - ANSWER✔✔-A person who brings together the user of capital (borrower) and the
supplier of capital (lender). For this service, a finder's fee is usually paid by the borrower.
Types of loans to which RESPA is applicable - ANSWER✔✔-RESPA applies to "federally-related mortgage
loans," which are defined as loans secured by a first or subordinate lien on residential property which
are:
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, ©EMILLECT 2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED
FIRST PUBLISH OCTOBER 2024
Made with funds insured by the federal government (e.g., FHA loans)
Made with collateral insured by the federal government (e.g., flood insurance)
Made with funds from a lender regulated by the federal government or that has deposits insured by the
federal government (e.g., depository institutions regulated by the FDIC or NCUA)
Intended for sale to Fannie Mae or Freddie Mac
Made by a creditor regulated under the Truth-in-Lending Act, or
Made by a mortgage broker and assigned to a creditor
Prohibitions, limitations, and Exemptions set by RESPA - ANSWER✔✔-
Required Disclosures to the customer for an MLO who is also a broker - ANSWER✔✔-Loan Estimate,
Closing Disclosure, special information booklet, affiliated business arrangement disclosure, disclosures
related to mortgage servicing and escrow accounts, and, in certain transactions, the Good Faith Estimate
and HUD-1 Settlement Statement.
Settlement Services - ANSWER✔✔-borrowers depend on a number of settlement service providers to
prepare for closing. Third-party services are provided by appraisers, inspectors, credit reporting agencies,
title insurers, and loan processors. Settlement services include any service provided in connection with a
real estate settlement, including but not limited to:
Page 2/26
, ©EMILLECT 2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED
FIRST PUBLISH OCTOBER 2024
Origination of a loan, including taking applications, loan processing, and underwriting and funding
Rendering of services by a mortgage broker, including counseling, taking applications, obtaining
verifications and appraisals, loan processing and origination services, and communicating with a
borrower/lender
Providing services related to origination, processing, or funding of a mortgage
Providing title services
Rendering of services by an attorney
Preparation of documents (notarization, delivery, recordation)
Rendering of:
Credit reports
Appraisals
Inspections
Conducting settlement by a settlement agent and related services
Providing services involving:
Mortgage insurance
Page 3/26
FIRST PUBLISH OCTOBER 2024
RESPA Exam Study Guide Solutions
RESPA origins and purpose - ANSWER✔✔-1974
To allow consumers:
-to obtain information on the cost of closing services
-protect consumes from excessive settlement costs and unearned fees.
Only fees for services performed and
No Unearned fees or Fee splitting (kickbacks)
Mortgage Broker - ANSWER✔✔-A person who brings together the user of capital (borrower) and the
supplier of capital (lender). For this service, a finder's fee is usually paid by the borrower.
Types of loans to which RESPA is applicable - ANSWER✔✔-RESPA applies to "federally-related mortgage
loans," which are defined as loans secured by a first or subordinate lien on residential property which
are:
Page 1/26
, ©EMILLECT 2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED
FIRST PUBLISH OCTOBER 2024
Made with funds insured by the federal government (e.g., FHA loans)
Made with collateral insured by the federal government (e.g., flood insurance)
Made with funds from a lender regulated by the federal government or that has deposits insured by the
federal government (e.g., depository institutions regulated by the FDIC or NCUA)
Intended for sale to Fannie Mae or Freddie Mac
Made by a creditor regulated under the Truth-in-Lending Act, or
Made by a mortgage broker and assigned to a creditor
Prohibitions, limitations, and Exemptions set by RESPA - ANSWER✔✔-
Required Disclosures to the customer for an MLO who is also a broker - ANSWER✔✔-Loan Estimate,
Closing Disclosure, special information booklet, affiliated business arrangement disclosure, disclosures
related to mortgage servicing and escrow accounts, and, in certain transactions, the Good Faith Estimate
and HUD-1 Settlement Statement.
Settlement Services - ANSWER✔✔-borrowers depend on a number of settlement service providers to
prepare for closing. Third-party services are provided by appraisers, inspectors, credit reporting agencies,
title insurers, and loan processors. Settlement services include any service provided in connection with a
real estate settlement, including but not limited to:
Page 2/26
, ©EMILLECT 2024/2025 ACADEMIC YEAR. ALL RIGHTS RESERVED
FIRST PUBLISH OCTOBER 2024
Origination of a loan, including taking applications, loan processing, and underwriting and funding
Rendering of services by a mortgage broker, including counseling, taking applications, obtaining
verifications and appraisals, loan processing and origination services, and communicating with a
borrower/lender
Providing services related to origination, processing, or funding of a mortgage
Providing title services
Rendering of services by an attorney
Preparation of documents (notarization, delivery, recordation)
Rendering of:
Credit reports
Appraisals
Inspections
Conducting settlement by a settlement agent and related services
Providing services involving:
Mortgage insurance
Page 3/26
