Real Estate Settlement Procedures Act (continued)
With the Good Faith Estimate buyers and borrowers will be able to make informed decisions during the loan/sale transaction and the settlement and escrow process. A lender may NOT charge anyone in connection with the preparation of the Good Faith Estimate - Uniform Settlement Statement or distribution of the Special Information Booklet. Almost all lenders fall under RESPA , except for loans made by private parties. The disclosure requirements are primarily the responsibility of the lender. RESPA regulates specified disclosures at the time of the loan application and at or before the time of settlement or closing of escrow. Violations of this law can be penalized by one year in jail and / or a $10,000.00 fine.
Real estate brokers acting as mortgage brokers do NOT have to give borrowers a seperate california-mandated mortgage loan disclosure statement in federally related loan transactions when the borrower receives a good faith estimate (GFE) of settlement costs as required under RESPA and all of the disclosures required by the Truth in Lending act.
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