A service fee charged by a lender and broker that the borrower pays on the closing date
All lenders and mortgage brokers charge an origination fee, which can be as high as 2.5% of the loan amount. Online mortgage brokers charge significantly less. Sometimes lenders will refer to this fee in terms of origination points, where 1 point equals 1% of the loan amount. Unlike discount points, you canÕt deduct the origination fee from your income taxes since it's just a service charge, not interest.
See: Closing costs