HUD Answers Frequently Asked RESPA Questions

The Department of Housing and Urban Development has issued guidance to give settlement service providers a better understanding of a RESPA rule that goes into effect January 1, but it doesn't get into the more complicated issues that some lenders and title companies are "grappling with," one expert said. RESPA attorney Phillip Schulman noted that the written responses HUD has provided to frequently asked questions will be "informative and instructive" for those who are not familiar with the Real Estate Settlement Procedures Act rule. However, the new RESPA rule completely revises the HUD-1 settlement sheet and requires lenders to provide a standardized good faith estimate disclosure to mortgage applicants. "For lenders and title guys who have been struggling to put the software together — to be able to complete the revised HUD-1 and GFE — the instructions were lacking," Mr. Schulman said. The K&L Gates Washington partner is hoping HUD will do a second round of frequently asked questions to address some of the more difficult issues.