First Time Home Buyer? Agencies and laws protect your rights

Written by Carly Hallman

There are so many weird acronyms out there that a new homeowner needs to be able to suddenly understand: CFPB, FCRA, RESPA, FHA, HUD, TILA, HOA, LMNOP … alright, that last one was made up, but you get the idea. With so many different code-like names for laws, regulations, and groups, it’s very easy to get them mixed up. Use this useful glossary of housing terms to stay on top of the crazy lingo. Don’t get overwhelmed when financial advisers use some of these complex-seeming terms. Many of them, like “CFPB regulations” and “HOA fees,” are normal kinds of phrases you’ll likely hear as you’re getting ready to buy your first home.

Beyond these housing term definitions, there are some other facts that a first-time home-buyer will need to know. Here is some important information to keep in mind:

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Do homeowners need to worry about CFPB regulations?

The Consumer Financial Protection Bureau, or CFPB, was created to help consumers after the recession and was designed to help avoid potentially predatory loans and excessive fees. CFPB regulations are in the consumer’s best interest, and compliance is a good thing to watch out for. If a lender isn’t within compliance for a housing loan, it can be a big problem for them and you. Use the CFPB’s many online tools to become acquainted with what to expect.

How does the Fair Credit Reporting Act (FCRA) factor into buying a home?

Banks and organizations collect information about you and arrange it into reports and scores, and you’re allowed access to some of that information. When you’re getting ready to buy a home, you need to make sure your credit score is up to a standard (which is usually a minimum score of 580 or more for subprime mortgages). Under this law, you have certain rights as a consumer, such as the ability to dispute inaccurate claims or request information.

Are “CFPB compliant” or “FCRA compliant” good things to hear?

Sure, but that’s sort of like putting “not a murderer” and “doesn’t insult people” on your résumé;. it shouldn’t impress you much. It’s certainly a good thing, though, because not being compliant with either would be a problem.


The Real Estate Settlement Procedures Act (RESPA) and the Truth In Lending Act (TILA) are two different laws that both regulate the settlement process to avoid bait-and-switching, kickbacks, and inaccurate loan cost information. After 2015, the CFPB combined the two disclosures into one to make everything simpler for consumers and banks. Now, you’ll see TILA/RESPA Integrated Disclosure (TRID) forms.

Are HUD and the FHA the same thing or related?

The U.S. Department of Housing and Urban Development (HUD) enforces the Fair Housing Act (FHA), so they are indeed related. One is a department with staff and management; the other one is a law. The FHA makes it illegal for lenders to make a lending decision based on factors like race or religion. If someone believes they’ve been discriminated against, they can contact HUD. In addition to enforcing the FHA, HUD also ensures that there’s affordable, public, low-income housing available for families and the elderly, among other things.

Is buying a HUD home a good or bad thing?

It depends. There’s nothing really wrong with it, and you can get a great deal on the house. A HUD home was usually acquired after a foreclosure and may need an inspection, among other things.

Are there fees associated with homeowners’ associations?

Often there are, yes. An HOA, or homeowners’ association, will usually be a nonprofit corporation that will have a set of rules as well as a fee, though the amount of that fee and the quality of those rules will vary drastically depending on the neighborhood.

These definitions of common home-buying acronyms as well as their explanations may come in useful as you shop for a home and a loan. For more information, contact the team at TitleMax®!

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