Oregon Broker PSI Practice Exam

What is the role of Consumer Financial Protection Bureau regarding real estate?

1. Enforcing fair housing laws

2. Administering RESPA

3. Overseeing local real estate commissions

4. Regulating real estate brokerage fees

The correct answer is: Administering RESPA

The Consumer Financial Protection Bureau (CFPB) plays a significant role in administering the Real Estate Settlement Procedures Act (RESPA). RESPA is a federal law designed to help protect consumers in the real estate transaction process, particularly during the mortgage process. It aims to ensure that borrowers receive important information about the costs of the settlement, eliminate kickbacks and referral fees that can increase the cost of loans, and provide consumers with protections against unnecessarily high settlement costs. The CFPB's responsibilities include enforcing the provisions of RESPA, which requires lenders to provide borrowers with disclosures about the closing process, as well as information about any affiliated business arrangements, and ensuring that consumers understand their rights related to real estate settlements. This oversight helps maintain transparency in mortgage transactions and promotes consumer confidence in the real estate market. The other options presented indicate areas relevant to real estate but are not under the direct purview of the CFPB. For example, enforcing fair housing laws is primarily the responsibility of the Department of Housing and Urban Development (HUD). Oversight of local real estate commissions typically falls to state real estate regulatory agencies that govern licensing and conduct standards for real estate professionals. Regulating real estate brokerage fees usually pertains to state laws and individual brokerage practices rather than federal oversight.