It is not directly tied to any service that they provide or cost that they incur. Application fee Lenders and Brokers may charge an application fee, it covers the costs associated with the initial processing of your loan package. To ensure that the house is worth at least as much as you are paying for it, lenders hire a third-party to objectively appraise the property. The lender will sometimes physically pay the appraiser at the time of the service, and then bill you for it at closing. This is the primary way that a broker charges for their service.
Traditional brokers charge between one and three percent of the loan amount.
Broker processing fee Brokers charge a processing fee to cover the cost to package the file, submit it to the lender, and help coordinate the closing of your loan. This cost covers the expense of processing the file internally or the cost of outsourced processing. This fee may already be included in the Lender administration fee or Processing fee. Credit report fee Lenders require credit reports to determine how well you have been able to handle financial obligations in the past. Lenders often get credit reports from more than one bureau, or get a report from a company that combines credit bureau reports.