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The correct answer focuses on the specific applicability of the Real Estate Settlement Procedures Act (RESPA), which governs the details of real estate transactions to ensure that consumers are provided with specific disclosures and protections associated with settlement costs. RESPA applies exclusively to residential transactions that involve properties containing 1-4 family units. This includes single-family homes, duplexes, triplexes, and fourplexes, all of which fall under the umbrella of residential properties.

RESPA's primary intention is to protect buyers and sellers in the residential real estate market from predatory practices and to ensure transparency around closing costs and settlement procedures. This legislation does not cover commercial transactions or residential properties that do not meet the criteria of owning between 1 and 4 individual family units. Thus, while it might seem that broader applications could encompass all residential transactions or even include commercial, the law is specifically tailored to the defined residential scope of 1-4 family units to protect consumers in this particular market sector.