According to Federal Regulators (CFPB, FDIC, FTC, et. Al.) a “consumer” is a buyer/seller who is engaged in the sale or purchase and/or the financing of 1-4 family unit property for occupancy and/or investment purposes when involving real estate related transactions.
The same regulators do not consider one to be a “consumer” when engaged in the sale/purchase/financing of 5+ multifamily units and all other property classified as commercial or agricultural. These regulators deem individuals buying/selling/financing real property in this class as “sophisticated” investors. Whereas a “consumer” is deemed as “unsophisticated” or less sophisticated.
A sophisticated investor is considered to be solvent and has the education to know how to evaluate, manage and understand the risks (and rewards) of real property ownership and are in the business to generate income.
A less sophisticated person is considered to have not all of the components or benchmarks as a sophisticated investor, therefore, this person must be protected from risk. The risk factors can be generated from a myriad of sources so the regulatory agencies have set up rules & regulations for the protection of the consumer and have initiated licensing programs for the practitioners when interacting with the consumer. Although this is not meant to be 100% protection for the consumer, knowing where and how to research individuals and businesses as a consumer is critical to having knowledge, being informed and being aware.
Here you will find links to the most common sources which can help you be a more informed consumer.