Loan Origination Fee

Loan origination refers to the initiation and completion of the home loan process, which begins when a borrower submits their financial information to a bank or mortgage lender for loan processing.

Depending on documentation type, a borrower will have to supply certain credit, income, asset, and employment information to a specified bank or lender to initiate the underwriting of the loan application.

Along with that, the borrower will have to sign forms that allow the mortgage broker (if applicable) and bank or lender to pull a credit report and release information about the borrower.

Once the information is submitted to the appropriate bank or lender, an underwriter will decision the application, either approving, suspending, or declining the loan.

To sum it up, loan origination is simply the creation of a mortgage. It may begin with a phone call, an e-mail, a mortgage rate quote, or a referral from a real estate agent.

Loan Originators Are Salespeople

So who’s behind all this loan origination anyways?

Well, loan originators of course. They’re also known as loan officers, mortgage brokers, loan specialists or simply salespeople. Or some other cute name a company comes up with like “loan hero” or “loan scientist.”

These originators may work on behalf of individual mortgage brokers, or for large retail banks that originate thousands of mortgage loans each month.  (See mortgage brokers vs banks).

Either way, their main job duty is to get you in the door and persuade you to apply for a mortgage with them, whether it be a purchase money mortgage or a refinance.

Now this isn’t to say that they’re pushy salespeople, it just means their highest priority is “getting a sale.”

They can also be quite helpful in guiding you through the home loan process, largely because both your incentives and theirs are aligned.  You want your loan to close and they get paid when it does. So everyone is on the same page.

Breaking Down the Loan Origination Fee

origination charges

This is a screenshot of an actual Good Faith Estimate, which displays the adjusted origination costs.

The fees associated with the origination of a loan are called, you guessed it, loan origination fees.  They are typically broken down into mortgage points, which are expressed as a percentage of the loan amount.  So if the loan amount is $100,000, and you see a $1,000 loan origination fee on the paperwork, the bank or broker is charging you one (1) mortgage point.

This “loan origination fee” is paid to the loan officer or broker who initiates and completes the loan transaction with the borrower, and is only paid out if and when the loan funds.  This fee is basically the originator’s commission for getting you a loan.  Some originators may tell you that it is paid to cover loan processing/application costs, though it’s pretty common to pay those AND the loan origination fee. Go figure.

In the example above, the loan origination charge is $1,840 on a $348,000 loan amount, which makes the fee roughly half a percentage point (.50%).  This particular broker charged a $250 origination charge, a $695 processing fee, and an $895 underwriting fee, which combined make up the $1,840 total.  Note that these fees are represented as one lump sum on the Good Faith Estimate, so ask for a breakdown to see what you’re actually being charged. Or refer to your Fees Worksheet.

fees worksheet

The corresponding Fees Worksheet pictured above breaks down the origination charges. Although not pictured here, lenders typically display a percentage on the same line as the Loan Origination Fee, such as 1.000%, if applicable.  This will give you a better idea as to what you’re actually being charged.

Now let’s refer to the top screenshot again.  Our borrower also received a lender credit of $3,076.32, which offset the entire origination charge and more, resulting in an adjusted origination charge of -$1,236.32.  This amount was put toward other closing costs, reducing the borrower’s out-of-pocket expenses.

Average Loan Origination Fee

In the mortgage world, it’s hard to provide universal answers, seeing that mortgages can differ tremendously.  The loan origination fee can vary based on who you decide to work with, and how complicated your loan is.  If you’ve got a cookie-cutter loan that you can get anywhere, this fee should be low.  The opposite is also true.  Either way, the loan origination fee is negotiable!  And it can be offset using a credit, as seen above.

If I had to throw out a number, I’d say the most common origination fee is 1% of the loan amount, which many banks will include in the fine print next to their advertised rates.  Wells Fargo used to include this exact disclaimer on their mortgage rates page, but it has since been removed.

Also note that for smaller loan amounts, a larger loan origination fee will need to be charged, seeing that it’s expressed as a percentage and won’t go nearly as far as a similar percentage on a large loan.

Brokers and banks may not even charge a loan origination fee directly to the borrower, depending on the terms of the deal. A true no cost loan doesn’t include a loan origination fee paid for by the borrower because it’s an out-of-pocket expense.

However, this means your interest rate will be higher as a result (lender-paid compensation), all else being equal. Loan originators have to make money somewhere, so if it’s not being charged on the front-end, they’ll make up for it on the back-end.

Either way, all fees should always be fully disclosed on the Good Faith Estimate and HUD-1. Pay close attention to this figure to see exactly what you’re being charged, whether paid out-of-pocket or via a higher-than-market interest rate. Most upfront banks and brokers will charge 1-2% of the loan amount, although this can vary.  If you shop around, you may be able to avoid the loan origination fee altogether, and get that low rate you’re after!

Lastly, compare the origination charges, all lender fees, AND your interest rate among different banks and lenders to get the complete picture.  Looking at just one or two of these figures won’t provide an accurate assessment.

Tip: Don’t confuse loan origination charges with discount points, the latter being what you pay if you want to buy down your mortgage rate, which is totally optional.


  1. Tom August 2, 2013 at 7:58 pm -

    Good summary – I guess this explains why they’re able to charge a fee for it.

  2. Wes September 17, 2013 at 1:37 am -

    I wasn’t charged a loan origination fee, but I was charged more than $1,000 for loan underwriting and processing. Is that basically the same thing, just a different way of labeling it?

  3. Colin Robertson September 17, 2013 at 8:55 am -

    It can be. If the combination of all those fees appear on line 801 of the HUD-1, under “Our origination charge,” that’s basically what they’re charging to originate your loan.

  4. Dave October 22, 2013 at 9:17 am -

    Perhaps you can answer a question. I bought the house 4 months ago (6/17) and want to pay it off before six months (12/17) since I sold the other house. The mortgage broker called to say he would have to refund the origination fee to the lender in that situation and wants me to wait until after six months to pay it off. Costs me additional interest, of course. Is this common? Would it be fair to ask broker to reimburse the interest I would have to pay if I wait? There is no prepayment penalty on the loan. The origination fee was 1.75% of the loan.

  5. Colin Robertson October 23, 2013 at 2:48 pm -

    It is standard industry practice for mortgage broker agreements to include something about compensation recapture for early loan payoff. I’ve seen some that say 120 days and others that say 180 days. You just never hear too much about it because most people hold their loans a lot longer than six months.

  6. Lynell March 3, 2014 at 6:23 am -

    They sure make the origination fee confusing for as much as regulators have professed to making the form “more clear.” This is about the most confusing, non-straightforward thing I’ve ever seen.

  7. Colin Robertson March 3, 2014 at 9:33 pm -

    Just focus on your interest rate and what you actually pay out of pocket.

  8. ela May 7, 2014 at 4:38 am -

    i signed for a loan what happened to be not eligible to take for the affordable property. it was offered by a bank and they charged me 495$. they said it was but finally the processor found out it wasnt. why did they take my money if it wasnt even my knowledge to know it and also i already paid for termite inspection what was mandatory with that loan

  9. Colin Robertson May 7, 2014 at 10:27 am -


    I’m assuming the $495 fee was for the appraisal?

  10. Gaby June 25, 2014 at 12:19 pm -

    Is there a cap a broker can charge for an origination fee?

  11. Colin Robertson June 25, 2014 at 10:40 pm -


    There are caps depending on the loan type and the lender they’re working with, along with their chosen compensation plan, but generally the fee ranges from 1-2%.

  12. dave June 29, 2014 at 5:40 pm -

    our Indiana based mortgage broker provided a form stating that their compensation is paid by the lender.

    They list a $4646 loan origination charge and then a $7188 credit for a difference of $2542 on the good faith estimate.

    how can they charge us an origination fee if their compensation is being paid by the lender or are these two different fees?

  13. Colin Robertson June 30, 2014 at 8:21 am -


    They have to show you their fee, even if it’s actually being paid by the lender.

  14. Ed June 30, 2014 at 1:10 pm -

    Today I asked a couple of questions to my mortgage broker about the origination points and that this is the best option to follow. And I understand why he would try to convince me. But he also send me a similar estimate for the same house but with 0 origination points and lower interest rate, but with Mortgage insurance which makes my monthly payment higher. Is the second scenario possible? If it is then who pays the borker if their payment is the origination points?

  15. Colin Robertson June 30, 2014 at 4:43 pm -

    It’s possible that a lower interest rate can have a higher overall payment if there is expensive mortgage insurance involved. And you don’t necessarily have to pay any origination fees out of pocket because banks/lenders pay brokers for giving you a slightly higher interest rate (which you pay over the life of the loan).

  16. Heidi July 15, 2014 at 2:28 pm -

    We are getting a mortgage on a house we already own. The mortgage person is asking for a deposit of $500 before they do any work and said it will only be taken if we don’t go with them. At what point do you typically make deposits or monetary promises with a mortgage company?

  17. Colin Robertson July 15, 2014 at 4:07 pm -


    It’s probably a deposit for the appraisal, which they will eventually order, but if you don’t close with them it’s essentially paid for and lost. The problem with these upfront application fees is that once they’re charged, borrowers feel trapped to continue on with the lender and can’t really shop around. And if the loan is denied you’re often out of luck. You should ask them what’s it for and read accompanying paperwork before taking any action, and/or shop around and find lenders willing to do some more work before asking for any fees.

  18. Shay July 25, 2014 at 2:12 pm -


    I just met with my loan officer to discuss my pre-approval. I am looking to buy a 175k home. The interest rate she gave me was 5.25% (coventional and somewhat unusual loan due to my circumstances) but with no PMI. Her brokerage fee was as follows: Orignation $2500, Underwriting $895, and Processing $695 for a total of $4090. This will be my first home and as much research as I’ve done, I don’t want to be ripped off. Does this sound about right? The fee is due to her 10 days before closing. Also, do I owe her anything if I decide to hold off on buying altogether?

  19. Colin Robertson July 25, 2014 at 3:46 pm -


    I don’t know the loan amount or the loan program, but I’ll assume a 30-year fixed and 10% down. Those lender fees, $4,090 divided by $157,500 amount to a total percentage of about 2.6%. The origination fee is nearly 1.6% of the hypothetical loan amount, coupled with a relatively high interest rate set at 5.25%. You might be able to shop and get that down to 1% with similar or even lower uw/processing fees (and even a lower rate). I can’t tell you definitively if it’s a good deal or bad (I don’t know all your details), but you should get a few quotes from other brokers/lenders to determine what’s a fair deal for your exact situation. Good luck on your first purchase!

  20. Katherine August 4, 2014 at 2:20 pm -

    I have received several Good Faith Estimates as the loan did not get processed in the rate locked in period. The origination charge on the estimates went from $1804 to $4917. When I asked the agent about the increase, he stated that the increase was due to the rate extension that he was going to credit back to me. That credit is for $1810 only. Now he is saying the remaining increase is because of translation costs. Shouldn’t he have explicit disclosed the cost to me? Is the GFE go enough? What recourse do I have?

  21. Sheila August 15, 2014 at 4:17 am -

    My issue is similar to Katherine’s. I received a Good Faith Estimate at the beginning and a guarantee that the lender would pay closing costs (this is a refi). About a month later, I received a new Good Faith Estimate that had more than tripled the origination costs and had also increased the third party costs by more than 12%. Can they do that?

  22. Colin Robertson August 15, 2014 at 10:34 am -


    Are they still paying all your closing costs? Did you ask why the costs went up? If your interest rate is the same and your actual out-of-pocket costs are the same, it might not be an issue. But if you’re paying more than originally quoted, there should be a valid reason. Generally, “our origination charge” (block 1) should not change.

  23. Manish September 23, 2014 at 9:59 am -

    Thanks for sharing your knowledge with everyone.

  24. Diego September 26, 2014 at 1:48 pm -

    Hi Colin,

    My broker has change the terms of my loan 3 times on the last 6 months. This means from 30% as down payment and 12 months as a reserve. Then, he said it will be 35% with no deposit. Then, 40% and then 40% as a down payment plus 6 months of mortgage. Do I need to pay any penalty if I decide to change lender/ broker?

  25. Colin Robertson September 26, 2014 at 3:29 pm -


    If you don’t want to use that broker anymore, you can shop around, but note that there might be non-refundable costs you already paid. Alternatively negotiate with the guy to get his act together OR you’ll go elsewhere.

  26. MIG October 7, 2014 at 7:57 am -

    I’M in the process of buying my first home. The GFE I received from the broker is completely different from , what the lender sent me. Stating change in circumstance. Based on appraisal, can they do this.

  27. Colin Robertson October 7, 2014 at 9:25 am -

    Carefully inspect what changed and why…a low appraisal could certainly change a lot of things. But make sure it all adds up.

  28. MIG October 14, 2014 at 5:03 am -

    Thank you for your answer to my question…but the appraisal was higher than what I am paying. Now the seller has changed the closing date stating this new property not ready. Is there anything I should be worried about.

  29. Colin Robertson October 14, 2014 at 9:21 am -

    Your purchase price should be the same regardless of appraisal coming in higher. A later closing date could affect your lock if you already locked your loan. Or if you’re not locked, you’ll need to consider interest rate movement and determine the right time to lock.

  30. mike November 14, 2014 at 5:49 pm -

    We are buying a new home in a CA subdivision and it would appear that we are locked into using their lender… but I wonder what we have agreed to. Here is the language in their disclosure…??

    “2. Multiple Loan Applications – Until the Lender notifies the Borrower of its final decision on whether to originate the Loan, the Borrower agrees not to make a mortgage loan application with another lender to finance the purchase or refinance of the subject property covered by this Lock-In Disclosure/Agreement.”

  31. jane November 17, 2014 at 7:24 am -

    Hi Colin,

    We locked our rate at the beginning of our application process. We’ve now received four different GFEs with higher and higher origination fees and points each time. We thought that, once locked, these shouldn’t change. Is this correct?

  32. Colin Robertson November 17, 2014 at 9:30 am -


    A “changed circumstance” (different loan amount or property value or credit quality of borrower) may allow the originator to issue a revised GFE, but the increased charges should only result from the circumstance that changed.

  33. Colin Robertson November 17, 2014 at 3:09 pm -


    I suppose that depends on what they actually mean by final decision. Do they consider loan approval to be the final decision? And what are the repercussions? Might want to ask for clarification.

  34. Harley December 4, 2014 at 5:26 pm -

    I’m being told, by the broker that I’m working with, that the Origination charge is non-negotiable, and that this was stipulated in the Dodd-Frank Mortgage reform act of 2010? Is this true?

  35. Colin Robertson December 4, 2014 at 10:52 pm -


    The broker is probably referring to the compensation tier they agreed to with the lender that is originating the loan, which can only change monthly or quarterly. For example, they may have chosen to receive 1.5% of the loan amount for each loan they send to Bank X. These tiers can vary from lender to lender so they could potentially send your loan to a different bank/lender where they’ve elected to earn just 1% per loan, or to another where they earn 2% per loan.

  36. Nick December 8, 2014 at 6:37 pm -

    People: Stop using brokers, and start going directly to lenders!


    Please provide me your insight on the following scenarios. I locked in my rate of 4.125% on 10/1 for 30 days, which expired of 10/31. We were waiting on the Certificate of Occupancy from the seller, so we could not close until 11/28. My loan officer said there are extension fees of $525 per week (4 weeks –> total of $2100). I did not sign any document regarding these fees so I did not pay them, and I made my loan officer pay for it. Were these legitimate fees? Should I have been the one to have paid for it?

  37. Colin Robertson December 9, 2014 at 11:10 am -


    Lock extensions fees are real, but it’s possible for lenders to eat the fees in some cases, especially if rates are lower than they were when you locked. You can always negotiate, which it sounds like you did.

  38. Brian January 7, 2015 at 12:26 am -

    Colin, I was recently pre-approved for a 200k loan. The total origination charge is 3442$. Broken down, it’s 1737 for the origination fee, 595 for processing, and 700 for underwriting. Are all those negotiable, or are they standard fees for FHA loans? Also, do all lenders have the same FHA loan rates, or does that diff per lender?

  39. Colin Robertson January 7, 2015 at 10:29 am -

    Everything is negotiable in life, though they still have to make money for taking care of your loan, obviously. You can play hardball and see if they’ll reduce or waive some of the fees, but there’s no guarantee they’ll budge. Generally you need to have another quote that beats what they’re offering to make an argument for them to go lower. And yes, FHA rates vary by lender, just like all other mortgage rates.

  40. jason January 8, 2015 at 11:29 pm -

    Let me start by giving you some background information. My wife and I own a house that we converted to a rental. Newbies as landlords. We have been living with family rent free while searching for our second home.

    All along, our loan officer said there would be no problems funding a loan on the second home as long as we show them a one year lease agreement. We had no problems providing this information. Our renter is covering the mortgage on the first house.

    We found house number two and had the loan officer provide a pre-approval letter and we put an offer on the house, which was accepted. Great news, right? I went to the loan officer’s office to lock in our rate. No issues so far as everything was moving along nicely.

    Fast forward a week. I get a call from the mortgage company regarding my loan. The loan officer left the company and gave my file to another loan officer. She told me that I would have to show 30% equity in property numbers one in order to fund the loan. Something the original loan officer forgot to tell me. So loan officer number two tells me that we’ll need to now go through a FHA loan versus a conventional loan as I originally agreed to and signed the rate lock documents for. The FHA loan will come with mortgage insurance for an additional monthly premium of $240.

    My questions are, are the rate lock documents and pre-approval legally binding? And shouldn’t I be able to enforce the terms that I signed with loan officer number two regardless of his oversight?

    Your input is greatly appreciated.

  41. Colin Robertson January 9, 2015 at 1:12 pm -

    Generally approvals are conditional upon you satisfying all the guidelines associated with the loan.

  42. James January 19, 2015 at 6:06 pm -

    I received a GFE for a refi and noticed that the loan origination fee was $6,295 with a credit $8302.50 for an adjusted origination charge of $-2,007.50. The loan amount is 270K with a 3.75% rate. The problem I’m having is that the broker agreement has a $5,400 origination fee listed. I was told I’m not paying anything at closing, no points, no bank fees, no title fees and the appraisal fee is to be credit back. Can you explain the difference between the GFE and the brokers statement? Thank you so much!

  43. Colin Robertson January 20, 2015 at 1:01 pm -


    Ask the broker why their fee increased. The credit of $8302.05 offsets their loan origination fee and then some (other closing costs), but you should know why their fee went up because it’s possible you could get a lower rate if the credit wasn’t so high.

  44. Steve January 31, 2015 at 7:21 am -

    Funny how EVERONE always claims to be the victim of the Bad Mortgage Broker, yet most would not even be able to get a loan or such a low rate without using a broker!

  45. Mike February 2, 2015 at 3:16 pm -

    Great read…..question does a HARP loan not require an appraisal? I thought it did not and the GFE I have has $450 charge for it also what is the proper escrow amount expected?

  46. Colin Robertson February 3, 2015 at 11:01 am -


    Many HARP loans get an appraisal waiver, but not all. Inquire about why it’s needed in your case. As for escrow, it depends on many factors related to your specific loan.

  47. Mike February 24, 2015 at 8:32 pm -

    Trying to refinance under the FHA Streamline refinance. The refinance company states that we will close on Mar 2 but that my current mortgage company is requiring interest to be paid through Mar 31st. Of course I have to pay the new finance company interest through Mar until my first payment on April 1st. How is it even legal for me to be charged double interest on the same loan?

  48. Colin Robertson February 25, 2015 at 10:46 am -


    The problem with FHA loans is that borrowers are charged an entire month of interest no matter when they close during the month. That’s why you often hear to close toward the end of the month to avoid this. However, the rule recently changed so new FHA loans won’t be charged this post payment interest, but it only applies to loans closed on/after January 21st 2015.

  49. Chris February 25, 2015 at 9:28 pm -


    Purchase Price 203K with 3% seller credit
    30 yr conventional loan 5% down 4.25 interest rate
    740 credit score borrower 775 credit score co borrower

    10,6 needed to bring to closing
    Origination fee is 2.5 percent (4821) with a 4821 lender credit for the 4.25 rate

    Does this seem OK? Is the origination fee high?

  50. Colin Robertson February 26, 2015 at 11:03 am -


    The only way to know for sure is to shop around and see what else you’re offered.

  51. Angela March 2, 2015 at 9:17 am -

    Hi Colin,

    My husband and I got three bids for loan rates and origination fees. They all three had the same rate, and we chose the guy who, in the end, offered the lowest origination fee. Unfortunately, as we are working on applying for the loan, I realized they are charging an additional processing fee and underwriting fee which together equal $695. This is separate from the origination fee because it is only $425. The other company made it clear that all of their fees are included in the origination fee, and I assumed all of them did the same. Now that I see these additional fees, this company no longer has the best deal and it seems dishonest to me that these two fees were not included in the origination fee. What do you think?

    Thank you for any advice,


  52. Colin Robertson March 2, 2015 at 10:55 am -

    Hey Angela,

    It’s not uncommon to charge a mixture of fees like underwriting/processing and an origination fee. That’s why it’s important to go through all the costs with a fine-tooth comb when comparing lenders. Perhaps you can try to negotiate the fees somewhat if you feel you’ve been wronged.

  53. Kyle March 5, 2015 at 12:50 am -


    Buying an inventory home on the last day of the month (Jan), the home builder offered me $11k towards closing from their “preferred lender” (which the builder owns 65% of) and then neglected to point out a clause in the contract that caped that to 3% of total purchase. ($245k) so I’m feeling a little taken advantage of… plus their origination fee is 2.75 %…Do i have any grounds to fight back?



  54. Colin Robertson March 5, 2015 at 1:25 pm -


    Not sure, but there’s always negotiating in the mortgage world…maybe argue for a slightly lower interest rate, etc.

  55. chakira March 14, 2015 at 2:09 pm -

    Hi Collin,
    i m in the process of refinancing for a lower rate. i have two offers. The first one is the streamline mortgage and they are asking me to bring one month mortgage payment at closing to put in my escrow account and i ll get one month off my mortgage payment. The second lender is asking for an appraisal fee of $475, i ll get a $1000 back at closing as a bonus and two months off my mortgage payment and they’ll put money in my escrow and add it to my loan amount. They are both offering me the same rate. i don’t know which one will be more beneficial to me. I also would like to know if they always charge a loan origination fee even with a streamline FHA mortgage.

  56. Colin Robertson March 16, 2015 at 9:33 am -


    Generally the lowest interest rate and fees is the best deal, obviously. If both rates are the same, lower fees prevail. Lenders have to make money so they charge origination fees, though borrowers may not actually pay them out of pocket. They may issue a credit to cover costs in exchange for a higher rate.

  57. Joe March 26, 2015 at 12:28 am -

    Hi Collin,

    I have been working with a loan officer to refinance my home. He claimed that he would not charge any fees for refinancing, and he is going to get paid only by the lender. Now I have received a paper(to be signed and approved by me) from Escrow that say about $6500 will been added to my mortgage which goes to my loan officer.
    My questions is:
    Can I cancel all transactions and stop working with my current loan officer since I have lost my trust in him? Would it cost me money?

  58. Colin Robertson March 30, 2015 at 4:17 pm -


    You may want to ask for clarification about where that money is actually coming from and if it’s really being added to your mortgage. If you want to cancel there may be cancellation fees or you can explore your right of rescission.

  59. Chet April 8, 2015 at 9:55 am -

    When it comes to escrow, one company quoted me escrow for 2 months and another company quoted me for 12 months….what is the norm here? Why did they quote me different amounts based on the months?

  60. Colin Robertson April 8, 2015 at 12:21 pm -


    Perhaps one is requiring impounds and the other is not? Ask them.

  61. DiAnne April 13, 2015 at 12:28 pm -


    I would like to shop lenders.

    Do they typically run credit checks before quoting their fees? If so, won’t this hurt my credit rating if run by several potential lenders?

    What is a reputable resource when comparing lenders. Lending Tree?

  62. Colin Robertson April 13, 2015 at 3:34 pm -

    Hi DiAnne,

    You can get quotes without running your credit, though it’s just a quote, not a commitment. You can also have your credit pulled by multiple mortgage lenders during a certain period of time and have it only count against you once, assuming a certain FICO score version is being used. And FICO scores ignore mortgage inquiries made during the 30 days prior to scoring. There are many comparison services nowadays, including Bankrate, Zillow, LendingTree, etc. Best to do your due diligence to ensure they are upstanding lenders.

  63. Kimberly April 14, 2015 at 4:39 am -

    I am in the process of a re-fi and scheduled to close in the next few days. I like the company I’m with and the new one will throw my loan on the open market. I’m all of a sudden not feeling comfortable with the new loan. If I do not close do I owe anything beyond the inspection fee legally?

  64. Colin Robertson April 14, 2015 at 11:45 am -


    It depends what you signed and if you paid for non-refundable items like appraisal and so forth. Borrowers are also given a chance to rescind on certain refinances.

  65. Tammy April 17, 2015 at 7:01 pm -

    Hello and thank you for the insightful article. We were within days of closing on house and found out the title was not clear therefore we were unable to close. Are we required to pay the origination fee if we go with another lender now?

  66. Colin Robertson April 20, 2015 at 10:37 am -


    The origination fee should only be paid if the loan actually closes.

  67. Cathy May 19, 2015 at 9:23 am -

    Colin – I am doing a VA streamline and the origination fee for a $479,700, 3.375 % 30 yr fixed rate loan is $8,520.58 which is almost 2% of the loan. Additional settlement charges are $6,222.88 for a total of $14,743.46.

    Mortgage broker is telling me that to get that rate, the origination fee is higher.

    Should I shop around more? I thought VA Streamlines were considered pretty simple since an appraisal isn’t required, etc. I also thought that VA loans couldn’t exceed 1% for the origination fee.

    Could you please advise?

    thanks, Cathy

  68. Colin Robertson May 19, 2015 at 8:40 pm -


    There is a 1% cap for origination. Maybe that total includes discount points, which are paid by the borrower to lower the interest rate. Ask them to break down all the costs line by line.

  69. Kathleen Ennis May 21, 2015 at 2:57 pm -

    I am at the tail end of a refinance (no cash out). My broker initially told me there were no origination fees. Since my rate was higher than I had hoped (4.1% and I have a 795 credit score/plenty of equity), this calmed me a bit. I am now hours away from signing and the final cost breakdown includes an “Origination Charge” of for $1925. When I questioned my broker, she responded thus:
    “Ok, I wish they would breakdown the costs like we used to do and not label them “origination.” As of 2010, the government started lumping underwriting, processing, and admin fees together on the Good Faith Estimate. The $1925 are bank fees are charged on every loan. They break down like this: Processing $650, Underwriting $675, and Admin $600. Back in the day, companies like us would charge all of those fees in addition to a 1% origination fee that would go to the loan officer. So, in plain English, these are the banks fees…not ours.”

    Is this correct? This is why I waited so long to refi….I loathe this pervasive feeling that I’m getting duped.

  70. Colin Robertson May 21, 2015 at 3:42 pm -


    As pointed out in the article, banks may sometimes just charge lender fees as opposed to an outright origination fee, and they will be lumped together as the origination charge. At the end of the day they are still fees. Maybe you can ask them to ditch the admin fee if you’re unhappy about it.

  71. joe May 28, 2015 at 7:47 pm -

    im going over my disclosures ATM. i was told by lender i would get a lender credit for my 30yr FHA of around ~$2300. now im looking at my GFE and my adjusted orgination charges the first box is checked.. the “The credit or charge for the interest rate of % is included in
    “Our origination charge.” now if i was getting a credit why wouldn’t they put in the amount here and check the second box just like the picture on the top of this page?? is it possible they put the credit towards another part of closing costs??

  72. Victoria June 3, 2015 at 9:17 am -

    It is my first home!
    The waiting period is terrible and stressful.
    Bank just charged me the “Pre-Closing Fees” (Appraisal, Cred Rep Fee, Pre-closing) but still waiting for the commitment letter.
    This charges will give me an idea if they approved?

  73. Colin Robertson June 3, 2015 at 4:13 pm -


    You won’t know you’re approved until they say you’re approved.

  74. Colin Robertson June 4, 2015 at 12:00 am -


    The first box is checked for retail transactions (non-brokered).

  75. Awzee June 18, 2015 at 7:55 am -

    Is origination fee charged in addition to the closing costs?

  76. Colin Robertson June 18, 2015 at 9:31 am -


    It can be yes…sometimes it covers the other closing costs, though it would then be a larger cost.

  77. Sarah June 18, 2015 at 4:23 pm -

    Hi Colin,
    How much can one’s FICO score *really* affect the interest rate/origination fee? If I have an excellent rating, how much can I expect to bargain down?

  78. Colin Robertson June 18, 2015 at 10:14 pm -


    It depends on the loan type and other loan attributes, such as LTV. It could have a huge effect, or not much at all. But if you feel you’re a strong borrower you can negotiate accordingly and shop around if you feel you’re not getting the deal you deserve.

  79. ed mckeever July 21, 2015 at 1:31 am -

    I have a closing in six days. WELLS FARGO and they have not sent me a breakdown of my mortgage payment .the payment has changed 2 times by 20.00 dollars i paid 870.00 to lock in the rate. thanks

  80. Cazzo August 23, 2015 at 11:02 pm -

    Good day Colin
    Is it possible to take out a larger mortgage loan then the actual price of the property? (For the above average credit score first time buyer). Thanks.

  81. Colin Robertson August 24, 2015 at 8:54 pm -


    I believe CashCall offered 125% LTV second mortgages, not sure if they still do. Or maybe a rehab loan where repairs are included in the mortgage.

  82. Cazzo August 24, 2015 at 9:34 pm -

    Thank you Colin!

  83. Emily September 2, 2015 at 12:30 pm -


    I recently closed on my house this week. The sellers covered up to $5,000 of the closing costs and the prepaids. The day of closing, my loan officer e-mailed me to let me know that she did the final approval on my FHA loan and that she took off $1,000 in closing costs. What does that mean? She told me that the lock on my rate had a discount point of .750 or $1,049 and that she waived the .750. Does this mean I will be getting some money back?

  84. Colin Robertson September 2, 2015 at 3:21 pm -


    Money doesn’t come back, so what you don’t use is left on the table. See if any credits can be used elsewhere to get use out of the money.

  85. German September 28, 2015 at 9:01 pm -


    Mortgage broker I’m going with is charging us 1.5% for origination fees- he went through some work to get us sapphire grant and make the numbers work on our loan. However according to him a 4.5 interest rate is set by the grantee? Is the origination fee negotiable/required to close deal?

  86. Colin Robertson October 1, 2015 at 10:52 am -


    This fee is typically negotiable, but not sure how much leverage you’ll have if he did a bunch of legwork to make the numbers fit…he may doubt you’ll be able to go elsewhere for your loan, but you can always ask.

  87. Lori Anderson December 7, 2015 at 9:02 am -

    I am divorcing and husband is keeping the house. Cma done at 300,000. He is going to refinance. His attorney said fees to refi were 13,500.00. They won’t give me the paperwork. We owe 116,000. How can these fees be so high?

  88. Colin Robertson December 7, 2015 at 11:24 am -


    Hard to say without knowing any of the details…could be taxes/insurance/rate buy down/origination/etc. Not sure how divorce proceedings work, but wouldn’t it be fair for you to see a breakdown if he’s buying you out?

  89. Armando Sanchez December 31, 2015 at 1:48 pm -

    Brokers have better Rates than Retail Lenders and have a lot more leverage than a Loan Officer. I have 2 Lenders that I Place loans thru. However My Rates by Far beat the Banks and Mortgage bankers because my Overhead is very minimal. Plus we can do Borrower Paid as well as Lender paid. This means more savings to the Buyers and Refinance customers. I can beat out the Best Banks in the US. I just took a Loan from Chase and the Buyer had 7 million dollars in that Bank. I still beat out their Rate and Fees to their Prime Borrower.

  90. santosh January 16, 2016 at 7:03 am -

    Hi Colin,

    Is loan origination fee refunded if deal falls apart, due to low appraisal or inspection issues etc.? Thanks!

  91. Colin Robertson January 16, 2016 at 5:35 pm -


    Yes, it should only be charged if/when loan funds.

  92. Patty January 21, 2016 at 10:12 am -

    Looking into refinancing. The broker told me that a new regulation for 2016 is that the borrower HAS to pay the appraisal fee upfront and have the appraisal before the underwriter reviews the loan. What happens if the underwriter comes back and says “no deal”?

  93. Colin Robertson January 25, 2016 at 5:29 pm -


    May want to shop around, especially if you’re worried about the value coming in low and eating the fee.

  94. Patty January 26, 2016 at 9:58 am -

    Thanks. I told them I was not willing to pay the appraisal fee upfront without any review beforehand to make sure I am eligible for loan. I received a response back saying, “I’ll cancel your application”. Really? So I wrote back and said, “That’s it? I guess you don’t want my business if you’re not willing to work with me”. I received a response stating that they would pay the appraisal fee and I am still waiting to hear back from them because I want something a little more concrete in writing than a Loan Estimate.

  95. Lucas February 5, 2016 at 2:56 pm -

    I received a mortgage origination disclosure document from the broker, and under “Mortgage Broker Fee (check one)”, it lists 3 choices and all 3 are checked.
    1. A fee of 2.75 of the principal amount.
    2. A flat fee of $_______________
    3. Lender or investor will pay the Mortgage broker a fee of $__________

    2.75% seems high, and then it looks like there are 2 more fees that they are not disclosing the amounts of. Have I read this wrong?

  96. Colin Robertson February 7, 2016 at 11:04 am -


    Generally a lender/broker will charge ~1 point or so for a reasonably sized loan, perhaps more if the loan amount is small because it wouldn’t be as much money for a similar amount of work. If you’re actually paying nearly 3 points out of pocket, as opposed to those points covering your closing costs, you may want to shop around and see if you can do better.

  97. Lucas February 11, 2016 at 8:55 pm -

    Thanks for the prompt reply. The loan amount is only around $80k, so does that justify the 2.75% or should I still shop around?

  98. Colin Robertson February 11, 2016 at 10:33 pm -


    That’s $2,200. If the loan were $220,000, also relatively small, and they charged one point it’d be the same commission. So you really do have to consider loan amount to determine if the origination fee is expensive or not. You can always see what else is out there. It’s generally recommended to get multiple quotes to see what other lenders can offer as far as rate/fees.

  99. Ugi February 13, 2016 at 11:22 pm -


    I am starting a refi with my original lender. The closing costs estimate show fees for lenders title insurance and endorsements. Why do they need this when I am using the same lender as my present mortgage?

  100. Colin Robertson February 14, 2016 at 3:46 pm -


    There may be a discounted rate (reissue rate) for title insurance when refinancing, but it’s still necessary as far as the lender is concerned to protect them from any unknown liens, claims, lawsuits, etc.

  101. Roxy February 15, 2016 at 9:12 am -

    Could you please tell me if a 4.75% Origination fee on a 71,000.00 loan is in good faith? They are also charging a 9.64% rate and 10.264% APR is there anything I can do about this?

  102. Colin Robertson February 16, 2016 at 11:53 am -


    That 4.75% would equate to a $3,372.50 origination fee. On $300,000 mortgages it’s common to see 1% charged, which is $3,000. So it might not be as bad as it looks, but you can always shop around and see if you can do better. The interest rate seems to be very high, though I don’t know the details of your loan.

  103. Ara Gul February 26, 2016 at 8:23 pm -

    I just received a set of loan papers for $218,000 FHA loan; the closing costs shown to be just a tad under $12, 000 but all previous loan disclosure statements showed the closing costs half of the latest closing costs.

    The loan originator slashed my downpayment into half: it was about $11,000 now it is 3.5 percent. He claims the FHA loans have higher closing costs, and my income is not adequate for conventional loan.

  104. Colin Robertson February 28, 2016 at 2:37 pm -


    You can ask him to break down all the costs so you know exactly what they are and why. And ask exactly why they nearly doubled? Also can ask specifically why income was an issue for conventional, was it DTI, etc?

  105. Ofelia March 9, 2016 at 7:40 pm -

    Is australian and US mortgage has the same terminologies?


  106. Colin Robertson March 16, 2016 at 10:27 am -


    They probably have some overlap, and even if the terms aren’t quite identical, they might share much of the same meaning since lending doesn’t tend to differ all that much worldwide. I’d assume all home loans come with a cost to the borrower, what they call those costs may vary from country to country. In any case it’s probably best to know exactly what the bank is saying in your native country.

  107. Darias March 21, 2016 at 4:26 pm -

    when is the right time to start negotiating some of the prices? I have just started contacting mortgage brokers and I have gotten one Approximate Loan Cost Illustration (ALCI). This includes some of the costs mentioned here, processing, underwriting, but I don’t see a loan origination fee.

    It seems that because some of the costs are determined once you find a house, I may not know what they are until later, but perhaps later may be too late?


  108. Colin Robertson March 22, 2016 at 11:37 am -


    You may not be charged a loan origination fee out-of-pocket…it could be rolled into a higher interest rate. You can negotiate whenever you want, but the later it gets, the less leverage you have because lenders don’t expect borrowers to jump ship late in the game.

  109. Ben Fox March 28, 2016 at 4:39 pm -

    Hi Colin I have decided to cut ties with my mortgage broker and finance my house through my local bank. With that said my mortgage broker is asking me to pay for the appraisal she had done for me. Do I have to pay her if I never signed any documents with her agreeing to the fee and I also have not given her my credit card or locked in a rate yet?

  110. Denise March 30, 2016 at 4:55 pm -

    Hi Colin, I cannot decide whether to go through a bank or a broker. Is it harder to get approved through a bank? Is it more expensive to use a broker? This is all so confusing! Thanks

  111. Colin Robertson April 4, 2016 at 6:52 pm -


    I have a post dedicated to that very subject. Search my site and you’ll find it.

  112. Colin Robertson April 4, 2016 at 7:00 pm -


    Hard to say but if nothing was signed it might just be them trying to recoup their costs and hoping you’ll pay in good faith. But if they can’t service you properly that might be a cost of doing business for them.

  113. Heather April 14, 2016 at 4:30 pm -

    What would happen if my mortgage loan was not originated?
    Are there civil penalties?

  114. Colin Robertson April 18, 2016 at 10:16 am -


    What do you mean it wasn’t originated?

  115. Grace July 8, 2016 at 8:23 am -

    Hi Colin,

    I am trying to refinance my home for $150,000 @3.500% with Wells Fargo.

    The Total Closing Costs = $4,655 (broken down as follows):
    Orig. Fee $995; Appraisal $430; Credit Report $11; Title Closing/Escrow $250; Title Clsg Protect Letter $75; Title Agent Reg Fee $3; Title Lender’s Policy $845; Title Search $175; Recording Fees & Taxes $227; Prepaid Interest ($14.38/day @3.500%) = $29; Initial Escrow Payment for 3 months = $1,653.

    I am wondering why they’re still charging another $5,198 for estimated cash to close TO BORROWER.

    Which makes the Total Payoffs go down to…
    – 4,655 Total Closing Costs
    – 5,198 Estimated Cash to Close TO BORROWER
    $140,147 Total Payoff Amount

    Pls. help. Thank you so much…


  116. Colin Robertson July 8, 2016 at 11:41 am -


    Are you receiving $5,198 in cash out because your loan amount is going from around $140k to $150k.

  117. Grace July 12, 2016 at 10:54 am -

    Thanks for your reply.

    I asked him about it and he told me that I don’t have to worry about it coz the final closing costs will only be around $900.

    Thanks again…

  118. Chris July 15, 2016 at 3:41 am -

    Colin, I’m currently working with a lender that originally said no points or origination fees, we are ready to close and now they said I have to pay points because I’m in a condo and my LTV is at 79%. We originally thought it was at 68% LTV and a single family residence is a PUD. The points are .432% at 3.3% fixed rate for 30 years. Is that a good deal at today’s market value? Or is this a bait and switch?

    This is what my loan officer said, “I just looked in the system. It is because the LTV increased with the Lower Value of the home. The original Loan To Value was at 68.361 and now we are at 79.429. Pricing changes every 5% LTV. I will call you to review”.

    Does this sound right? Thanks
    Thank you.

  119. jeff July 16, 2016 at 9:12 am -

    Please advise: My wife and I are looking to refi our primary residence with money out, and I was quoted $13,000 in closing costs (cash to close is $4,307. Origination charges are $7813) Loan amount is $250K, 15-year, at 2.25%. Both our credit scores are over 800. Are we getting ripped off, or is this negotiable? Not sure how to proceed. Thank you in advance for your advice.

  120. Colin Robertson July 18, 2016 at 10:24 am -


    Going from 68% to 79% LTV can definitely change pricing dramatically, as can a condo vs. SFR. And yes there are LTV pricing tiers that may adjust every 5% to 10%.

  121. Colin Robertson July 18, 2016 at 11:36 am -


    You may want to break down the closing costs to see why they’re so high…it sounds like you might be paying discount points to get a rate that low…2.25% sounds really low.

  122. jeff July 18, 2016 at 7:52 pm -

    Thanks for the response Colin. So I guess what I’m needing to know is, how do you optimize a refinance when it comes to “points”? Do I buy points, or do I go with lower points? I don’t understand the whole “points” thing, it sounds like a used car salesman gimmick to me, used to confuse the consumer with excessive numbers.

  123. Colin Robertson July 18, 2016 at 9:00 pm -


    I have an article dedicated to that very topic on the right sidebar menu of this page.

  124. Cindy July 25, 2016 at 10:52 pm -

    We’re buying a home and financing $300K; the down payment from the sale of our current home will be $110K, so that’s well over 20% down. Our credit scores are in the mid-700s.

    We are accustomed to paying into an escrow account, and plan to do so for our new loan. We intend to borrow from our local credit union, where I’ve been a member since the 1970s. They’re offering a 30-year fixed-rate loan at 3.65% for long-term members.

    I received initial disclosures from our CU today, and was shocked at the closing cost estimate of nearly $24K. This included a 1% loan origination fee, lots of fees in the $250-650 range, and prepayment for a full year of both homeowners’ insurance (overestimated by a fair bit) and property taxes (also overestimated).

    This total represents about 8% of our loan amount. Is it just me, or does that seem really out of line? What are my odds of succeeding if I decide to push back on the fees with my CU loan officer?

  125. Colin Robertson July 28, 2016 at 10:06 am -


    Closing costs can be pretty high with prepaid items like taxes and insurance, along with what is needed to set up the escrow account. The cost of those items won’t change from lender to lender, only just when you have to pay them. If you’re paying it all upfront it can be hefty. Might want to look at the other costs and shop around to see if others can do better. And yes, you can negotiate with the credit union too.

  126. Jean August 10, 2016 at 11:47 pm -

    Colin, I hope you are still responding to this thread. I will be receiving my final closing disclosure tomorrow, for a loan that is to close on Monday, Aug 15th. They have already given me a GFE, but I’ve found some discrepancies. This is a VA loan. They are charging only $417 for origination fee, but have added a processing fee and an underwriting fee as itemized charges under the origination fee header. Should I negotiate this, because I looked up the regulation on VA loans (VA Pamphlet 26-7, Revised Chapter 8: Borrower Fees and Charges) and read they can not legally charge me for these two additional charges as itemized fees. I also read that they should not be charging me document prep fees, title closing fees and tax transfer fees, which they do have listed on my GFE, and there are no credits given to offset any of these costs. It would make about a $1000 difference in my closing costs. My credit score is 815, and they gave me a rate lock at 3.25%. What do you advise? Tell them I don’t agree to the terms, because they are not legal? Ask them to have the seller, or lender absorb those costs? I’m not sure. I realize they could have just charged me 1% of the loan as an origination fee to offset not being able to charge me the itemized fees, but since they have already disclosed the origination fee as $417, can they change it? The loan is for 166,900.

  127. Colin Robertson August 15, 2016 at 12:55 pm -


    I think the key here is ensuring lender costs stay below the 1% threshold.

  128. Mark August 26, 2016 at 7:54 am -

    Hello, I am doing a VA refi and I don’t have to pay the VA funding fee because I’m a disabled veteran. I see the total they are charging is a 3% origination fee and that to me seems excessive. Can you comment? Thanks in advance! Mark

  129. Colin Robertson August 28, 2016 at 8:41 am -


    You may want to ask why they’re charging that high of a fee. The origination fee is limited to 1% on VA loans…maybe the fees are discount points or something else?

  130. Nicole September 23, 2016 at 10:12 am -

    Hi Colin,

    Currently doing a refinance and locked in at 3.25%. We opted to take a .625 % higher rate. However the lender is still charging the 1% origination $3k + a lender credit of $8600. I always thought when going with a higher rate the origination is removed.


  131. Colin Robertson September 23, 2016 at 1:49 pm -


    The old days were like that but if they were always going to charge you 1% then the rate just increased to cover your lender credit, not their commission.

  132. Ofelia October 3, 2016 at 6:44 pm -

    what is a split loan? and what is the benefit of this to the client?

  133. Colin Robertson October 4, 2016 at 10:07 am -


    I think you’re referring to a hybrid loan arrangement where one loan is fixed and the other is adjustable.

  134. Kevin October 26, 2016 at 1:05 am -

    Hi Colin,

    We are planning to purchase a home at $295,000 and will need a loan of $236,000. The lender we are working with quoted us for the loan and after looking over the document we are confused on the origination fees. Can you help explain what the difference between “Loan origination fee” and the “uw/process fee”? Are we being overcharged? This is the listed fees from our loan officer.

    Origination Charges
    Funding Fee to BCF–$355
    Loan Origination Fee–$2360
    Processing Fee–$595
    Underwriting Fee–$795

    We are first time home buyers and do not want to be taken advantage of.

    Thank you,

  135. Colin Robertson October 26, 2016 at 8:06 am -


    The processing and underwriting fees are technically for loan processing and loan underwriting, whereas the loan origination fee (1% in your case) is the loan officer or broker’s commission. There are three separate jobs involved, uw/processor/salesman. Not everyone charges ALL these fees, though many do. You can always try to negotiate them lower.

  136. Ruben November 1, 2016 at 9:20 am -

    My sister has two business for almost 10 years and owns the two properties, about $300′ each and a house approximately $400′ all paid off.
    But last year she default a mortgage loan with a bank and made a deal to pay only $40,000 of the remaining debt, of course her credit went bad to 640.
    Now she wants to buy a new property for a new business (all day care centers).
    Two banks already declined the loans. she has good cash flow and willing to put down 30% or more if needed.
    What will be your recommendation?
    Go to a another small bank or look on the internet to get the loan?

  137. Ginger November 12, 2016 at 12:11 am -

    Hi Collin
    I started a refinance process back in May I believe it was so long ago that I cannot remember the exact month. The loan officer said that it would be better if I took out cash which I really did not need or want but I agreed. My GFE has changed 3 or 4 times. My credit score is 805. Estimated closing costs were $1,564 (includes $2,263 in loan costs + $196 in other costs – $895 in lender credits. Estimated cost to close -$1,594. Original loan amount $376,000, interest rate 3.875%, monthly principal $1,768.09. Now I am getting ready to close and the loan amount is now $369,500, same interest rate and new monthly payment of $1737.53. The rate lock expired. New estimated closing costs $6,371 (includes $7,066 in loan costs + $155 in other costs – $850 in lender credits. Estimated cost to close $6,344. They just recently re-verified my credit with the 3 credit bureaus. On the final estimate they also increased what was charged for the appraisal from $425 to $605. It seems to me that this process has taken longer than necessary as documents were requested in a piecemeal fashion resulting in this prolonged period. Also, why have my fees increased so substantially? Am I responsible for the cash to close and can I back out of this loan? I am no longer comfortable with this company. By the way, they are the company handling my current mortgage that has been sold several times.

  138. Danie December 8, 2016 at 11:43 pm -

    Hello Colin, My state is Texas. I have read several of the posted questions and responses. I understand the importance of asking questions of the lenders and doing research. A friend recommended using QL. She used their services in October 2016 and several of her associates/ friends have used QL as well. When I advised my realtor that the pre-approval is with QL she quickly discouraged me from using them and stated it is best to go local, that QL charges high fees. I asked QL and was told they would be better or lower then local banks, the only fee a lender can control is the origination and often times that can be negotiated. Your input would greatly be appreciated. Thank you in advance.

  139. Colin Robertson December 9, 2016 at 10:00 am -


    I doubt any lender would talk you out of using them. I’ve heard mixed opinions of QL, but you’d really need to compare options to see who offers you the best deal (lowest rate and fees) and can close your loan in a timely fashion. Good luck.

  140. Shanta December 12, 2016 at 11:03 pm -

    Hi Colin

    Im in Alabama and I am in the process of purchasing a home in the amount of $68k. I am getting a 203(b) with escrow repairs in the amount of $3245. I just recieved my loan estimate and my origination fees are $1,493. Is charging over 2% on a small amount financed normal on these type of loans?

  141. Colin Robertson December 13, 2016 at 10:43 am -


    On a small loan balance a higher percentage could actually equate to less in fees. For example, 1% of $500,000 is $5,000, whereas 1% of $100,000 is just $1,000, and it may require the same amount of work to close…

  142. John L February 22, 2017 at 10:22 am -

    Hi Colin,

    I am purchasing a home in California.
    I am dealing with a direct lender [the largest direct lender] and I feel that their fees are too high. Can you please review and confirm? The fees are about 1.3% of the purchase price.

    I have shopped around and some direct lenders have lower fees and even provides closing cost credits.

    It’s just that dealing with this major lender has been such a more simple/ efficient online/email process compared to other lenders who take up so much of my valuable time insisting on phone calls.

    Thank you for your input.

    Purchase Price – $480,000
    Loan Amount – 384,000
    Down Payment – 96,000 [20%]

    Origination- $1049
    Appraisal fee/credit report/appraisal management/ flood determination fee – $761
    Title cost – $2470
    Recording fees and transfer taxes – $609
    Pre-paids – $793
    Escrow – $432

  143. Colin Robertson February 23, 2017 at 10:25 am -


    What fees did you feel were high? The LO fee appears to be very low at just a fraction of a percent. Nothing seems exorbitant as far as I can see, though as you mentioned, lenders will often credit closing costs. But that may result in a higher interest rate, which is the trade-off. You could ask what services you can shop and see if there’s a cheaper provider they and you feel comfortable with using instead.

  144. Jay March 12, 2017 at 4:59 pm -

    Use North American Savings Bank, lowest rates and origination fees period.Use betterment or wealthfront for low cost investing. Use the walmart savings catcher app for groceries.Use groupon for outings and dinners.Use bj, costco gas stations where available. And buy a good used car.
    take advantage of employee 401k match. Eventually buy a franchise, invest in real estate and you’re a millionaire.

  145. Jim March 18, 2017 at 12:34 pm -

    Hi Colin
    Great info….Id appreciate your input as to what is legit and possible junk fees.

    Im putting down 600k on an 800k home. I have 820 FICO no long or short term debt.

    Should I be required to have escrow collected by my lender?

    What is difference between loan application fee of $570 and and loan processing fee of $995.
    Under Title charges broker indicates following
    closing fee of 975 in addition to owners and lenders title policies
    (2700 + 700)

    Also there is a $295 real estate admin fee ?

  146. Colin Robertson March 18, 2017 at 2:17 pm -


    Some lenders charge an outright origination fee while others might charge you itemized fees for application, processing, etc. in place of that fee, just a different approach. The title stuff is between you and the title company, and your lender will probably say you can shop around for different quotes if you’d like. Looks like title insurance policies and a closing fee (the actual legwork involved via escrow). May want to inquire about the real estate fee to what exactly that is and why it’s being charged. Good luck!

  147. Ken schwenk April 26, 2017 at 11:33 am -

    I was charged a $500 fee to get the GFE started…was told it would be refunded when loan was approved…because of 2 errors on behalf of the mortgage broker, loan was not approved…is this fee refunded??

  148. Colin Robertson May 1, 2017 at 11:11 am -


    You may want to check your paperwork, but it sounds like something they should refund because they screwed up. It might take some jostling between you and them to get the money though…consumers now have the CFPB to make complaints to if lenders aren’t being aboveboard.

  149. Joni May 19, 2017 at 7:29 pm -

    I am looking to refinance my home. I have about 100k equity in the home and originally locked in a rate 5.5 interest. I dont actually have a question for you but I wanted to give you praise on being a source for all those out there with questions. Thanks for all the valuable information on this site.

  150. Colin Robertson May 20, 2017 at 7:14 am -


    Thanks for a nice comment! That’s why I keep answering…

  151. Aimee May 25, 2017 at 1:38 pm -

    Dear Colin:

    I’m considering a 15-yr convtl refi on $137k at 3.25% fixed in NJ. I’m already with this lender who’s servicing it. There are fees for Appraisal ($480), HOA cert ($250), Closing Protection Letter ($75), Lender’s Title Ins ($383), Settlement Fee ($325), Title Endorsements ($100), Title Exam ($100), and Upper Ct Lien Search ($16), Recording ($270). I don’t understand why these are necessary, but I don’t want to ignorantly ask to cut something that’s standard. Please identify what is unnecessary. Thanks!


  152. Colin Robertson May 26, 2017 at 4:30 pm -


    They all appear to be pretty standard fees, though if you shopped your title and escrow you’d maybe be able to get some of these costs lowered. If you google each one you’ll see what they all are and why a lender would require them.

  153. Scott May 29, 2017 at 1:14 pm -

    I am looking to buy a house in the next 60 days. I have 2 houses that are paid off. I understand that Cash is king when buying a house in Denver, where the real Estate is hot. Credit is around 800. Is it best to get a cash out mortgage on the 2 properties and use the cash for the new house. Any ideas>?Thanks

  154. Colin Robertson May 30, 2017 at 2:58 pm -


    That’s up to you…other options might include a HELOC or home equity line. Would depend how long you would need the financing, what the rates are, closing costs, prepayment rules, etc.

  155. Sandra Vizcarra June 6, 2017 at 4:28 pm -

    Hello Colin, I have a question I’m in the middle of refinancing my home & unfortunately my credit & as well as my husbands is not very good & after several attempts to refinancing we finally got approved. Our whole goal was to refinance in order to due a debt consolidation. When reviewing our disclosure documents of the loan break down there is a fee titled “Urban home insurance” of $3,482.00 after all the other broken down fees the total cost of refinancing fees total about $11,000.00. That seems crazy high. We are in Arizona so I’m not sure if that is normal. Our total loan amount refinanced is only $172,000.00. Could these fees be right.

  156. Pete June 13, 2017 at 12:00 pm -

    I have a 169K loan that I am refinancing at 3.25%. There is a $3300 origination fee. This is cookie cutter loan, simple and to the point. My credit is 690, is this a practical origination fee?

  157. Colin Robertson June 13, 2017 at 6:25 pm -


    It sounds like they’re charging you about 2 points…whether this is good or bad depends on what other fees you were charged, if any, and also the attributes of your loan and you as a borrower. Also keep in mind that a smaller loan amount earns less on a per percentage point basis, so 2 points may sound like a lot but might not be a lot. Consider a $500,000 loan amount – one point would be $5,000. One way to determine if it’s high is to get other quotes.

  158. Corri November 21, 2017 at 6:32 am -

    What is a mixed used charged in an origination fee?

  159. Colin Robertson November 21, 2017 at 10:05 am -


    Is the property you’re financing mixed-used? If so, the lender might charge a fee for it and list it under their origination charge. Best to ask them for clarification so you know exactly what it is.

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