For decades, the government has adopted the public policy of encouraging home ownership. Thus, Congress has over the years passed several laws that protect consumers throughout the mortgage lending process.
The Fair Housing Act prohibits discrimination against loan applicants on the basis of race, color, sex, national origin, and other protected personal traits. A law called the Real Estate Settlement Procedures Act (RESPA) prohibits those who refer a settlement service from receiving a fee or other portion of the proceeds. It also requires that lenders provide certain disclosures throughout the loan origination process and give the consumer a good faith estimate of the closing costs expected to finalize the loan.