Question:

What are origination fees in a general mortgage application?

Answer:

Borrowers should be aware that what origination fees are for one lender may be different for another lender. Usually, lenders charge origination and discount points separately, but they may be combined, or lowered and increased at the expense of other loan-related costs.

What are origination fees and how big are they?

Origination fees are usually quoted 1% or 2% of the loan amount, but they could reach higher on different occasions.

Lenders have different rates when you buy discount points. If you plan on living in the house for long, it is advisable you buy down your interest rate. A discount point is equal to 1% of the loan. Generally, buying 1 point means your rate will be reduced with 0.125%.

What origination fees are charged for evaluating and prepping the paperwork for your loan depends on the lender. Some lenders spread the cost of origination among other costs; or, the quoted origination fees may include other charges at lender's discretion.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
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