Which act requires lenders to keep records for 2 years?

Which act requires lenders to keep records for 2 years?

• A. Real Property Records Act
• B. RESPA
• C. Truth in Lending Act
• D. Fair Housing Act

Answer: (B)

This question tests recordkeeping requirements tied to the Real Estate Settlement Procedures Act (RESPA). RESPA is designed to protect consumers by ensuring transparency in settlement costs and preventing abusive practices. As part of that protection, RESPA requires lenders to maintain records of the settlement process and disclosures for two years after the settlement date. This retention period helps regulators verify that disclosures and charges were accurate and properly provided. The other acts focus on different protections and do not set a two-year lender recordkeeping requirement: the Real Property Records Act deals with recording real estate documents; the Truth in Lending Act centers on disclosure of loan terms and costs but does not specify a two-year retention period; and the Fair Housing Act addresses nondiscrimination in housing and mortgage lending, not record retention timelines.

This question tests recordkeeping requirements tied to the Real Estate Settlement Procedures Act (RESPA). RESPA is designed to protect consumers by ensuring transparency in settlement costs and preventing abusive practices. As part of that protection, RESPA requires lenders to maintain records of the settlement process and disclosures for two years after the settlement date. This retention period helps regulators verify that disclosures and charges were accurate and properly provided.

The other acts focus on different protections and do not set a two-year lender recordkeeping requirement: the Real Property Records Act deals with recording real estate documents; the Truth in Lending Act centers on disclosure of loan terms and costs but does not specify a two-year retention period; and the Fair Housing Act addresses nondiscrimination in housing and mortgage lending, not record retention timelines.