Which federal act provides protection to consumers in the mortgage process?

The Real Estate Settlement Procedures Act (RESPA) is the correct answer because it was specifically designed to protect consumers during the real estate settlement process. RESPA aims to ensure that consumers receive information regarding the costs associated with closing a mortgage transaction and to prohibit certain practices such as kickbacks and referral fees that could increase the cost of borrowing. By mandating disclosures and establishing procedures, RESPA enhances transparency and helps consumers make informed decisions about their mortgage loans.

RESPA's emphasis on clear communication regarding settlement costs, the requirement of a Good Faith Estimate, and the use of a Closing Disclosure form all contribute to a more consumer-friendly mortgage experience. This is essential for borrowers as it safeguards them from potential exploitation during a complicated and financially significant process.