According to the HLPA, who is required to provide loan counseling to applicants receiving a high-cost loan?

The correct answer is that a nonprofit third-party organization approved by HUD is required to provide loan counseling to applicants receiving a high-cost loan, as outlined by the Home Loan Protection Act (HLPA). This is in place to ensure that borrowers receive impartial advice and guidance that can help them understand the terms and implications of high-cost loans, which can often have more complex and potentially risky financial components.

The involvement of a nonprofit organization approved by HUD helps to provide a standardized level of service and ensures that the counseling is conducted by qualified professionals who are knowledgeable in the risks of high-cost loans. This requirement also helps to protect consumers by making sure they have access to information that can empower them to make informed choices regarding their finances.

In contrast, other individuals such as loan officers, attorneys, or financial advisors are not mandated under the HLPA to provide this loan counseling. Loan officers may be biased, as they represent the lending institution, while attorneys and financial advisors may not specifically focus on the unique issues related to high-cost loans as effectively as dedicated nonprofit organizations that specialize in counseling these consumers.