Quick answer
An origination fee is what the lender charges for making your mortgage loan, covering work such as processing the application, underwriting and funding. It appears in section A, “Origination Charges,” on page 2 of the Loan Estimate and Closing Disclosure, and it generally can’t increase at closing except in specific circumstances.
Key facts
3%
Qualified Mortgage cap on points and fees (larger loans)
CFPB, Federal Register 90 FR 57890 · 2026 threshold
One fee or several
Some lenders charge a single percentage of the loan; others list separate application, processing and underwriting fees. All of them belong in section A, alongside any discount points, so compare the section A total between offers rather than the fee names. A lender that advertises no origination fee may be pricing its costs into a higher rate, which the APR helps reveal.
An example against the cap
Say a lender charges a 1% origination fee on a $300,000 loan, which is $3,000, and you buy one point at 1% of the loan, another $3,000. Section A totals $6,000. To be a Qualified Mortgage, a loan of this size generally can’t carry points and fees above 3% of the loan amount, or $9,000 here, and origination charges count toward that limit. See how section A fits with the rest of the bill in the Loan Estimate guide.
Related terms
- Lender credit, which can offset section A
- Closing costs
Sources
- CFPB — Cost of one discount point (share of loan amount) (Oct 19, 2023)
- CFPB, Federal Register 90 FR 57890 — Qualified Mortgage points-and-fees cap (loans of $137,958 or more) (2026 threshold)
- CFPB: What are mortgage origination services? What is an origination fee?
Last reviewed Figures are checked against the sources above. Read our editorial policy. This page is general information, not financial advice — see the disclaimer.