Believe it or not, that is pretty standard verbage for brokered loan disclosures. In the past, brokers earned “yield spread” from lenders on loans by marking up the interest rate, and that yield spread was disclosed on the final settlement statement. Process was simple, disclosed, and minimal confusion was involved.
Now HUD requires brokers to show that borrowers get that credit for accepting their rate and the broker then charges borrowers that amount for facilitating the loan. Same net process as in the past, just more cumbersome, and obviously confusing. Thanks, HUD. It’s interesting that most lenders now have to resort to “cost worksheets”, “loan estimates”, or some other version of the previous Good Faith Estimate to explain the prospective loan to borrowers, since the new HUD mandated disclosures are both difficult to understand and much more lengthy than the older versions were. HUD has made a fairly simple process into a difficult one, confusing borrowers while obstensibly trying to make the broker compensation process more transparent.
No, you just have to find the right broker. If you are working with a broker they must disclose to the penny the commission made on the loan.