May Brokers charge a separate fee for either in-house or third-party processing?
If a processing fee is charged, it should be included on the HUD settlement statement. The part of your question that needs some explanation is that you called it “a third-party processing fee.” Under Maryland law a broker may collect as broker fee (called “finder’s fee” in Maryland law) an amount up to 8% of the loan, and all broker fees must be set forth in a written agreement signed by both the broker at the borrower within 10 days of “initial application.” (What constitutes “initial application” is a very long discussion not addressed here.) In my opinion, a processing fee charged by a broker is nothing more or less than broker fee (and this is true whether the processing fee is paid over to a third party or is retained by the broker). Processing is a part of the work that a broker should be performing; it is part of the broker’s job for which the broker has a right to collect a fee. If the broker decides to hire a third party to perform this work, that is likely acceptable, but it
