(B) A person shall not earn, charge or charge a mortgage broker or processing fee unless the person meets the requirements of this chapter, is authorized to provide mortgage intermediation services or is exempt from the requirements of this chapter under this chapter. Legally, anyone who uses a mortgage broker instead of a direct lender to buy a home must enter into a fully executed mortgage brokerage contract before the broker can assess the original fees. State laws prohibit a potential buyer from paying an origination fee to mortgage brokers unless there is a written mortgage brokerage agreement between the two parties. The brokerage contract must be signed and dated by the home buyer and the mortgage broker or the director of the subsidiary when the broker works for a mortgage brokerage company. (C) All fees collected for services provided as a mortgage broker must be disclosed to the applicant by the mortgage broker in accordance with federal or national law. Mortgage brokerage agreements protect buyers from fraud. Anyone who uses a mortgage to buy a home must go through the original credit process. This provides the credit product that corresponds to the buyer`s credit profile and net worth and needs. The lender collects an origination fee — also known as an administrative fee, insurance or processing fee — to assess and prepare the mortgage.
The original fee may include documenting, the lender`s legal fees, notary fees and related fees. The written brokerage agreement must clearly state the services provided by the mortgage broker, the terms of the original fee and the dollar amount that the mortgage broker must receive as a credit fee. In most countries, a mortgage broker can only charge one application and third-party fees — valuations, surveys, credit reports — before a qualified lender approves a home loan. If the mortgage broker receives a commission or inducement from the lender in addition to the original fee, the mortgage brokerage contract must clearly state that compensation, amount and purpose.