What is the main purpose of the RESPA Act?

The primary purpose of the Real Estate Settlement Procedures Act (RESPA) is to help consumers make informed decisions regarding the purchase of a home and the mortgage process. RESPA mandates clear disclosures and transparency in the settlement process, which allows consumers to understand the costs associated with a mortgage and the various services involved in closing a transaction. This includes providing a Good Faith Estimate outlining expected settlement costs and a HUD-1 Settlement Statement that summarizes the final costs incurred.

By ensuring consumers receive essential information about their mortgage transactions, RESPA promotes educated decision-making, helping buyers to avoid unnecessary fees and fostering greater awareness of their rights and obligations in real estate transactions. The act does not govern interest rates, ensure fair lending practices as its primary function, or provide tax benefits, which are governed by other regulations. This focused goal of enhancing consumer awareness and understanding is what makes this answer the most accurate choice.