This topic was originally blogged about on July 26, 2010 & addressed HUD's request for comments. The request can be found at this link, but has long since expired.
Currently, the regulation reads as follows, but as you can tell the regulation greatly impacts the job of a real estate agent & you should not only remain informed, but have your voice heard on any future changes to the definition.
Required use means a situation in which a person must use a particular provider of a settlement service in order to have access to some distinct service or property, and the person will pay for the settlement service of the particular provider or will pay a charge attributable, in whole or in part, to the settlement service. However, the offering of a package (or combination of settlement services) or the offering of discounts or rebates to consumers for the purchase of multiple settlement services does not constitute a required use. Any package or discount must be optional to the purchaser. The discount must be a true discount below the prices that are otherwise generally available, and must not be made up by higher costs elsewhere in the settlement process.