Definition
A fee charged by the lender for processing and underwriting the mortgage, typically 0.5-1% of the loan amount. On a $350,000 loan, the origination fee might be $1,750-$3,500. Some lenders advertise "no origination fee" loans but compensate with a slightly higher interest rate. The origination fee is disclosed on the Loan Estimate.
Related Mortgage Terms
- Closing Costs
Fees and expenses paid at the finalization of a real estate transaction, typical...
- Discount Points
Prepaid interest paid at closing to lower the mortgage interest rate. One point ...
- Loan Estimate
A standardized three-page document that lenders must provide within three busine...
- Amortization
The process of paying off a mortgage through regular monthly payments of princip...
- Annual Percentage Rate (APR)
The total annual cost of a mortgage expressed as a percentage, including the int...
Understanding mortgage terminology helps you compare loan offers and make informed decisions. Use our mortgage calculator to see how these terms affect your monthly payment.