What type of charge is a broker fee classified as?

A broker fee is classified as a finance charge because it represents the cost of obtaining a loan or credit. Typically, finance charges include all expenses related to obtaining the loan, which encompasses the broker's services in facilitating the transaction. This charge is disclosed to the borrower as part of the total cost of borrowing and is intended to provide a comprehensive view of what the borrower will pay in the process of securing financing.

On the other hand, origination charges typically refer to fees that cover the lender's costs of processing a loan application and may include underwriting and other administrative tasks. Processing fees and documentation fees refer to specific charges related to the handling of paperwork and processing of the loan, but do not encapsulate the overall cost of the broker's services. Thus, classifying a broker fee as a finance charge accurately reflects its role in the overall cost of acquiring the loan.