Loan Origination Fee
A loan origination fee is the free charged by a broker for the
broker's expertise in knowing which lender
is likely to fund your loan and, in some instances, assisting you to prepare the documents
required to close the loan efficiently.
Example:
You obtain a 20 year mortgage for $100,000 and pay 1 point. To obtain the loan, you
are required to pay 1 point or $1,000 up front. You are allowed to deduct 1/20th of this
amount each year or $50. If you pay off the balance of the mortgage early, you can deduct
all unused points in that year.
