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Rights as a Buyer

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The housing market can be a treacherous landscape. The sheer amount of money, time, and emotion you are probably investing in your search for a new home is enough to deal with without having to look over your shoulder for people who are out to get you. This is why there are certain laws that have been set in place to protect buyers throughout the process of purchasing a home.

Fair housing

In the United States, it is illegal to discriminate against anyone attempting to purchase a home loan or a house based on:
  • Race or skin color
  • Country of origin
  • Religion
  • Sex
  • Familial status
  • Handicap
The Fair Housing Act was passed to protect consumers against these types of discriminations. No one may refuse to provide the sale or rental of housing, mislead anyone as to the availability of housing, or set different conditions for housing based on any of the above categories. For lenders who are providing mortgage loans, it is also illegal to deny, set different conditions for, or refuse to provide information about a loan based on any of the above categories. No one may attempt to threaten or coerce anyone away from or toward any kind of housing or mortgage. It is also illegal to advertise in a way that encourages or discourages purchasing a home or mortgage based on any of the above.

If you are a disabled individual, your landlord must allow reasonable accommodations for you to live (e.g., altering a "no pets" policy to allow a seeing-eye dog or building a wheelchair ramp), though these may be at your expense.

RESPA

The Real Estate Settlement Procedures Act (RESPA) is designed to keep competition between lenders and providers of settlement services healthy by discouraging bribery and unfair partnerships between companies. RESPA helps to keep market prices down by keeping the consumers' options open concerning who provides their settlement services. It also contains stipulations that keep the borrower informed during the loan process, decreasing the chance that he or she will get taken for a ride.

TIP: To read about RESPA in more detail, check out our Real Estate guide "The Real Estate Settlement Procedures Act – RESPA".

Legal recourse

If you feel that you have not been treated fairly according to housing market regulations, you are encouraged to contact the U.S. Department of Housing and Urban Development (HUD). Find the office nearest to you, and give them a call or write them a letter describing what has happened. More information about where to find HUD offices and what you need to know are detailed in this http://www.hud.gov/offices/fheo/FHLaws/FairHousingJan2002.pdf.

Adam Mandelbaum  Posted by Adam Mandelbaum on May 14, 2010

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