Which legislation is designed to improve transparency in the mortgage market?

The Dodd-Frank Act is designed to enhance transparency and accountability in the financial system, including the mortgage market. Enacted in response to the financial crisis of 2008, this legislation aimed to regulate financial institutions more strictly and to protect consumers from unfair lending practices.

One of the key components of the Dodd-Frank Act is the establishment of the Consumer Financial Protection Bureau (CFPB), which oversees various regulations and ensures that consumers receive adequate disclosures regarding mortgage terms, fees, and risks associated with lending practices. This increased oversight and regulation promotes transparency, giving consumers clearer information about mortgage products and helping them make more informed decisions when borrowing.

In contrast, other options, while also related to consumer protection and transparency in various ways, do not encompass the same broad range of financial market reforms as the Dodd-Frank Act. For example, the Truth-In-Lending Act primarily focuses on standardizing disclosure of the terms and costs of loans, but does not provide the comprehensive market reforms that Dodd-Frank introduced. Similarly, the Real Estate Settlement Procedures Act addresses the home buying process and settlement procedures, aiming to ensure that borrowers receive clear information about closing costs. The Secure and Fair Enforcement Act focuses on the licensing and regulation of mortgage loan officers.