October 08, 2020

CFPB releases FAQs, rescinds bulletin on RESPA

CFPBThe CFPB Wednesday released new FAQs for the Real Estate Settlement Procedures Act (RESPA) and Regulation X related to gifts, promotional activities, and marketing services agreements (MSAs). In addition, the bureau rescinded a 2015 compliance bulletin related to MSAs.

The FAQs are meant to address RESPA's prohibition against kickbacks – providing anything of value for a referral relating to a settlement service in a mortgage transaction – and are broken out into four topics:

  • general RESPA Section 8 provisions, including explanations of Sections 8(a) and 8(b), and what individuals, entities, and transactions are covered by the section;
  • what activities are prohibited under Section 8(a);
  • gifts and promotional activity; and
  • MSAs.

In a blog post announcing the FAQs and rescission of Compliance Bulletin 2015-05 RESPA Compliance and Marketing Services Agreements, the bureau said the bulletin "does not provide the regulatory clarity needed on how to comply with RESPA and Regulation X."

"The Bureau's rescission of the Bulletin does not mean that MSAs are per se or presumptively legal," the bureau wrote. "Whether a particular MSA violates RESPA Section 8 will depend on specific facts and circumstances, including the details of how the MSA is structured and implemented."

The bureau indicated that it will continue to scrutinize MSAs and enforce RESPA Section 8.

NAFCU has several compliance resources available on mortgage servicing rules.