Origination Fee
Also called: arrangement fee, loan processing fee, lender fee
An origination fee is what a lender charges to process and underwrite a loan, usually 0.5–1% on mortgages and up to 8% on some personal loans, often deducted from the amount you receive. It's the main reason a loan's APR exceeds its headline interest rate, and the main reason two loans with identical rates cost different amounts. Compare offers on APR and total cost, never on rate alone, and treat origination fees as negotiable — they frequently are.