What is the effect of failing to comply with the Good Funds Settlement Act on the enforceability of loan documents?

The correct answer reflects that there will be no effect on the enforceability of loan documents if the Good Funds Settlement Act is not complied with. This means that even if proper compliance procedures were not followed, the legal standing of the loan documents themselves remains intact.

The Good Funds Settlement Act primarily sets standards for how funds are to be handled during a real estate transaction, ensuring that funds are available and traceable. However, the act does not necessarily invalidate the loan documents nor does it impact their enforceability in the event of a dispute or default. Therefore, the loan agreement, including the obligations and repayment terms detailed in it, remains binding regardless of compliance issues related to the handling of funds.

In practical terms, this serves to protect lenders and borrowers alike, establishing the necessary assurances that even in the case of procedural oversight concerning funds, the agreements made still hold legal weight.