Finance
What is 'loan origination fee' and how does it affect Illinois borrowers' closing costs?
AA fee paid to IDFPR to register a new mortgage
BA fee charged by the lender for processing the loan application and establishing the loan, expressed as a percentage of the loan amount or a flat fee✓ Correct
CA fee paid to the title company for originating the escrow
DA penalty charged when the borrower does not use the lender's preferred title company
Explanation
A loan origination fee is charged by the lender for processing and originating the mortgage. It may be expressed as a percentage of the loan amount (e.g., 1%) or as a flat dollar amount. Origination fees are included in the APR calculation and are disclosed on the Loan Estimate and Closing Disclosure under TRID. Shopping among multiple lenders, including comparing origination fees, helps Illinois borrowers minimize closing costs.
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