Nationwide Mortgage Licensing System (NMLS) Practice Exam

Who is responsible for enforcing violations of RESPA?

1. FTC

2. CFPB

3. FHA

4. FCC

The correct answer is: CFPB

The correct answer is the Consumer Financial Protection Bureau (CFPB), which is responsible for enforcing violations of the Real Estate Settlement Procedures Act (RESPA). The CFPB was created in response to the financial crisis of 2008 to protect consumers in various financial transactions, including those involving mortgage loans and real estate settlements. RESPA was established to help consumers understand their rights and the costs associated with real estate transactions and to eliminate abusive practices. The CFPB has the authority to oversee compliance with RESPA, investigate potential violations, and impose penalties for non-compliance. This role is crucial in ensuring that consumers are treated fairly and that they have access to transparent information about the costs and terms of real estate settlement services. Other organizations mentioned do not have the enforcement authority over RESPA. While the Federal Trade Commission (FTC) supervises various consumer protection laws, it does not specifically enforce RESPA. The Federal Housing Administration (FHA) primarily handles mortgage insurance and housing-related programs, and the Federal Communications Commission (FCC) regulates communication industries rather than real estate financing practices. Hence, the CFPB's specific mandate makes it the correct entity for enforcing RESPA violations.