Real Estate Settlement Procedures Act

(LATEST SUMMARY)

Real Estate Settlement Procedures Act - Directs the Secretary of Housing and Urban Development to report to the Congress on whether, in view of the provisions of this Act imposing requirements and prohibiting practices in connection with real estate settlements, there is any necessity for further legislation in this area. Sets forth the procedures to be followed should such corrective measures need to be taken.

Directs the Secretary, in consultation with the Administrator of Veterans' Affairs, the Federal Deposit Insurance Corporation, and the Federal Home Loan Bank Board, to develop and prescribe a standard form for the statement of settlement costs which shall be used as the standard real estate settlement form in all transactions in the United States which involve federally related mortgage loans. Requires such form to conspicuously and clearly itemize the charges imposed upon both the borrower and the seller in connection with the settlement.

Directs the Secretary to prepare and distribute special booklets to help persons borrowing money to finance the purchase of residential real estate to better understand the nature and costs of real estate settlement services.

Requires lenders to provide the booklet to each person from whom it receives an application to borrow money to finance the purchase of residential real estate.

Requires lenders agreeing to make a federally related mortgage loan to provide to the prospective borrower, and to any officer or agency of the Federal Government proposing to insure, guarantee, supplement, or assist such loan, at the time of loan commitment (or, if there is no commitment, at a time prescribed by the Secretary), an itemized disclosure in writing of each charge arising in connection with such settlement.

Prohibits any person from giving and accepting any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, involving a federally related mortgage loan.

Prescribes limits on the amounts a lender, in connection with a federally related mortgage loan, shall require the borrower or prospective borrower to deposit in any escrow account which may be established in connection with such loan for the purpose of assuring payment of taxes and insurance premiums with respect to the property.

Prohibits a lender from making any commitment for a federally related mortgage loan unless it has confirmed that the specified information has been disclosed in writing by the seller or his agent to the buyer.

Directs the Secretary to establish and place in operation on a demonstration basis in various areas of the United States, a model system or systems for the recordation of land parcels in a manner and form calculated to facilitate and simplify land transfers and mortgage transactions and reduce the cost thereof.

Authorizes and directs the Board of Governors of the Federal Reserve System to conduct a study of escrow accounts maintained by lenders in connection with mortgage loans which require borrowers to make periodic prepayment of taxes, insurance, and other items with respect to residential real property, in order to determine the feasibility of requiring lenders to pay interest on such accounts.