source:
  type: regulation
  id: reg-x-1024.5
  authority: 12 CFR §1024.5 — Coverage of RESPA (Regulation X)
  description: 12 CFR §1024.5 — Coverage of RESPA.
  coverage_tier: operative
obligations:
- id: reg-x-1024.5-full
  canonical_id: reg-x-1024.5-full
  section: 12 CFR §1024.5 — Coverage of RESPA
  type: do
  tags:
  - regulator-direct
  - respa
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: 12 CFR §1024.5 — Coverage of RESPA
    source_class: cfpb-regulation
    source_url: https://www.law.cornell.edu/cfr/text/12/1024.5
    snapshot_id: 186726c5bbd240d9
    fetched_at: '2026-06-17T17:21:37Z'
    content_hash: sha256:20fbccf2950ca7c0e32a033e4634d1154d02689f4a650062323b0a38a4dfbc6c
    paragraph_quote: '§ 1024.5 Coverage of RESPA . (a) Applicability. RESPA and this
      part apply to federally related mortgage loans, except as provided in paragraphs
      (b) and (d) of this section. (b) Exemptions. (1) [Reserved] (2) Business purpose
      loans. An extension of credit primarily for a business, commercial, or agricultural
      purpose, as defined by 12 CFR 1026.3 (a)(1) of Regulation Z . Persons may rely
      on Regulation Z in determining whether the exemption applies. (3) Temporary
      financing. Temporary financing, such as a construction loan. The exemption for
      temporary financing does not apply to a loan made to finance construction of
      1- to 4-family residential property if the loan is used as, or may be converted
      to, permanent financing by the same lender or is used to finance transfer of
      title to the first user. If a lender issues a commitment for permanent financing,
      with or without conditions, the loan is covered by this part. Any construction
      loan for new or rehabilitated 1- to 4-family residential property, other than
      a loan to a bona fide builder (a person who regularly constructs 1- to 4-family
      residential structures for sale or lease), is subject to this part if its term
      is for two years or more. A “bridge loan” or “swing loan” in which a lender
      takes a security interest in otherwise covered 1- to 4-family residential property
      is not covered by RESPA and this part. (4) Vacant land. Any loan secured by
      vacant or unimproved property, unless within two years from the date of the
      settlement of the loan, a structure or a manufactured home will be constructed
      or placed on the real property using the loan proceeds. If a loan for a structure
      or manufactured home to be placed on vacant or unimproved property will be secured
      by a lien on that property, the transaction is covered by this part. (5) Assumption
      without lender approval. Any assumption in which the lender does not have the
      right expressly to approve a subsequent person as the borrower on an existing
      federally related mortgage loan . Any assumption in which the lender ''s permission
      is both required and obtained is covered by RESPA and this part, whether or
      not the lender charges a fee for the assumption. (6) Loan conversions. Any conversion
      of a federally related mortgage loan to different terms that are consistent
      with provisions of the original mortgage instrument, as long as a new note is
      not required, even if the lender charges an additional fee for the conversion.
      (7) Secondary market transactions. A bona fide transfer of a loan obligation
      in the secondary market is not covered by RESPA and this part, except with respect
      to RESPA ( 12 U.S.C. 2605 ) and subpart C of this part (§§ 1024.30-1024.41).
      In determining what constitutes a bona fide transfer, the Bureau will consider
      the real source of funding and the real interest of the funding lender . Mortgage
      broker transactions that are table-funded are not secondary market transactions.
      Neither the creation of a dealer loan or dealer consumer credit contract , nor
      the first assignment of such loan or contract to a lender , is a secondary market
      transaction (see § 1024.2 ). (c) Relation to State laws. (1) State laws that
      are inconsistent with RESPA or this part are preempted to the extent of the
      inconsistency. However, RESPA and these regulations do not annul, alter, affect,
      or exempt any person subject to their provisions from complying with the laws
      of any State with respect to settlement practices, except to the extent of the
      inconsistency. (2) Upon request by any person , the Bureau is authorized to
      determine if inconsistencies with State law exist; in doing so, the Bureau shall
      consult with appropriate Federal agencies. (i) The Bureau may not determine
      that a State law or regulation is inconsistent with any provision of RESPA or
      this part, if the Bureau determines that such law or regulation gives greater
      protection to the consumer. (ii) In determining whether provisions of State
      law or regulations concerning affiliated business arrangements are inconsistent
      with RESPA or this part, the Bureau may not construe those provisions that impose
      more stringent limitations on affiliated business arrangements as inconsistent
      with RESPA so long as they give more protection to consumers and/or competition.
      (3) Any person may request the Bureau to determine whether an inconsistency
      exists by submitting to the address established by the Bureau to request an
      official interpretation, a copy of the State law in question, any other law
      or judicial or administrative opinion that implements, interprets or applies
      the relevant provision, and an explanation of the possible inconsistency. A
      determination by the Bureau that an inconsistency with State law exists will
      be made by publication of a notice in the Federal Register. “Law” as used in
      this section includes regulations and any enactment which has the force and
      effect of law and is issued by a State or any political subdivision of a State
      . (4) A specific preemption of conflicting State laws regarding notices and
      disclosures of mortgage servicing transfers is set forth in § 1024.33(d) . (d)
      Partial exemptions for certain mortgage loans. Sections 1024.6 , 1024.7, 1024.8,
      1024.10, and 1024.33(a) do not apply to a federally related mortgage loan: (1)
      That is subject to the special disclosure requirements for certain consumer
      credit transactions secured by real property set forth in Regulation Z , 12
      CFR 1026.19 (e), (f), and (g); or (2) That satisfies the criteria in Regulation
      Z , 12 CFR 1026.3 (h). [ 76 FR 78981 , Dec. 20, 2011, as amended at 78 FR 10874
      , Feb. 14, 2013; 78 FR 44717 , July 24, 2013; 78 FR 80104 , Dec. 31, 2013; 80
      FR 8775 , Feb. 19, 2015]'
  judgment: false
