What Is Origination Fee?
Origination Fee: A lender or broker charge for processing and making the loan, often a percentage of the loan.
An origination fee is what a lender or mortgage broker charges for evaluating, preparing and making your loan. It may be a percentage of the loan (often 0.5% to 1%) or a flat fee, and may be labeled origination, underwriting, processing or application fees.
Where you'll see it
In section A, "Origination Charges," on your Loan Estimate. These charges can't increase at closing unless there's a valid change in circumstances.
Comparing lenders
Look at the total of origination charges plus discount points, alongside the rate. Some lenders advertise low rates with high origination fees.
Good to know
Origination fees are included in the APR, which helps you compare.