BEST OF

6 Best Mortgage Lenders with Low Origination Fees of 2022

Most lenders charge an origination fee for giving you a mortgage. These top-rated mortgage lenders boast lower origination fees.

By NerdWallet 

Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.

Origination fees are one of the many costs you should research when choosing a lender. When it comes to the closing costs you’ll face when signing the paperwork for your loan, the mortgage origination fee can be a significant number. It’s often 0.5% to 1% of your total loan amount.

NerdWallet constantly surveys mortgage providers about their origination fee and any other lender charges that will be included in your overall closing costs.

These lenders charge competitive origination fees.

Nerdy tip: Even for lenders that advertise loans with no origination fee, one may not be automatically offered — you may have to ask for loan terms that exclude an origination fee.

Best Mortgage Lenders with Low Origination Fees

NBKC
Learn more

at NBKC

NBKC: NMLS#409631

5.0

NerdWallet rating 
NBKC

Min. credit score

620

Min. down payment

3%
Learn more

at NBKC


Why we like it

Good for: borrowers who want low rates and fees and an online experience with phone support. VA loans are an emphasis.

Pros

  • Offers government-backed loans and some harder-to-find products, such as construction loans and specialty mortgages for pilots.

  • Offers low rates and fees compared with other lenders, according to the latest federal data.

  • Displays customized rates, with fee estimates, without requiring contact information.

Cons

  • HELOCs and construction-to-permanent loans are available only in the Kansas City metro area.

Read Full Review
Better
Learn more

at Better

Better: NMLS#330511

5.0

NerdWallet rating 
Better

Min. credit score

620

Min. down payment

3%
Learn more

at Better


Why we like it

Good for: tech-savvy borrowers who prefer an online experience.

Pros

  • Offers a program allowing qualifying buyers to make cash offers.

  • Makes it easy to see customized mortgage rates.

  • Average interest rates are on the low end compared to other lenders, according to the latest federal data.

Cons

  • Doesn’t offer USDA loans.

  • VA loans are not available in every state.

  • Doesn't offer home equity loans.

Read Full Review
BNC National Bank
Learn more

at BNC National Bank

BNC National Bank: NMLS#418467

4.0

NerdWallet rating 
BNC National Bank

Min. credit score

620

Min. down payment

3%
Learn more

at BNC National Bank


Why we like it

Good for: First-time home buyers and others who want low-down-payment loan options.

Pros

  • Offers a wide variety of loan types and products.

  • Has robust online capabilities, and an app for iOS and Android.

  • Mortgage interest rates are lower than typical, according to the latest data.

Cons

  • Has a limited number of physical mortgage offices.

  • No rate information is available without starting an application or speaking with a loan officer.

  • Does not offer home equity loans or lines of credit.

Read Full Review

PenFed: NMLS#401822

4.0

NerdWallet rating 
PenFed

Min. credit score

620

Min. down payment

3%

Why we like it

Good for: borrowers looking for online convenience, a wide selection of mortgages and the competitive rates of a member-owned credit union.

Pros

  • Offers a broad selection of home loan products, including low-down-payment options for first-time home buyers and HELOCs.

  • Offers a lender credit, based on loan amount, for purchase mortgages.

  • Mortgage rates and fees are low compared with other lenders, according to the latest data.

Cons

  • Does not publish sample mortgage rates on its website.

  • The lender credit isn't available for refinance mortgages.

Read Full Review

Veterans United: NMLS#1907

4.0

NerdWallet rating 
Veterans United

Min. credit score

620

Min. down payment

0%

Why we like it

Good for: veterans, active-duty service members and eligible reservists looking for VA loans.

Pros

  • Offers 24/7 customer service over the phone.

  • Offers a free credit counseling service.

  • Mortgage rates are on the low side, according to the latest federal data.

Cons

  • Doesn’t offer home equity loans or HELOCs.

  • Veterans United has physical branch offices in only 17 states.

  • Focus on VA loans, so may not be the strongest choice for those seeking other loan types.

Read Full Review

Citibank: NMLS#412915

4.5

NerdWallet rating 
Citibank

National / regional

National

Min. down payment

3%

Why we like it

Good for: Buyers who want to explore low down payment mortgages, including government-backed loans and Citi’s proprietary option.

Pros

  • Offers a wide variety of loan options, including low-down-payment mortgages and jumbo mortgages.

  • Offers low rates compared with other lenders, according to the latest data.

  • Receives high marks for customer satisfaction, according to J.D. Power and Zillow.

Cons

  • Requires help from a loan officer to complete an online mortgage application.

  • Customized mortgage rates not available without making contact.

  • Doesn’t offer renovation loans.

Read Full Review

What is an origination fee on a mortgage?

The origination fee is what a lender charges you for giving you a mortgage — it's essentially a service fee, and one way that lenders make money. Another big source of income is profit that's built into the mortgage interest rate it offers you.

If a lender claims to offer no origination fee, proceed with caution. The fee may be baked into the interest rate, or it could show up under a different name, like an underwriting fee or an administrative fee.

You can find the origination fee and associated costs on the second page of your Loan Estimate. You'll get this document from any lender that has offered you mortgage preapproval, and it's a standard form, which makes them easy to compare. At the top left of page two, you'll see a box labeled "A. Origination Charges." Under that heading, you'll find lender charges, including the origination fee and optional mortgage points.

How much should origination costs be?

Origination fees are charged as a percentage of the loan amount, so they vary depending on the size of your mortgage and the percentage the lender charges you. Between 0.5% and 1% of the total loan amount is fairly standard. If you're taking out a loan for $250,000, your origination fee would probably be between $1,250 to $2,500. In 2020, the median origination fee paid on purchase loans was $1,349, according to Home Mortgage Disclosure Act data.

You can try to negotiate these costs. This is yet another reason having mortgage preapprovals can help, as you could try to convince a lender to lower its fees based on another lender's offer. In a buyer's market, you could potentially also negotiate to have a home seller chip in toward your closing costs.

When do you pay the origination fee?

You’ll pay the origination fee as part of your closing costs, once your loan has been approved and money's ready to change hands. No later than three days before closing, you'll get a closing disclosure that you should go over to check on all costs, including the origination fee. This form looks more or less identical to the Loan Estimate, except that it has real numbers instead of estimates. Compare the two forms to see how the costs may have changed. Some are easy to understand. For example, property taxes are prorated based on the closing date, and when you got the loan estimate, no one knew what day of the month that would be. If anything looks off, contact your loan officer to ask about it. That's why the three-day window is required.

Since the considerable chunk of change paid on closing day also includes your down payment, it's usually paid with a wire transfer or cashier's check to a third party (this is one type of escrow in real estate) rather than directly to the seller. Make sure to leave enough time to move all the funds you're using for your down payment and closing costs to an easily accessible bank account to avoid any last-minute holdups.

More from NerdWallet

Last updated on May 2, 2022

Methodology

The star ratings on this page reflect each lender's overall star ratings. Read more about how we determine those ratings.

The lenders on this page are chosen using this methodology:

NerdWallet reviewed nearly 60 mortgage lenders, including the majority of the largest U.S. mortgage lenders by annual loan volume (lenders had to have at least a 1% market share), lenders with significant online search volume and those that specialize in serving various audiences across the country.

For inclusion in this roundup, lenders must achieve an overall rating of at least 4.5 stars from NerdWallet. Lenders must charge among the lowest origination fees relative to other lenders NerdWallet surveys, according to federal data, and have among the best ratios of origination fees to offered mortgage rates.

NerdWallet solicits information from reviewed lenders on a recurring basis throughout the year. All lender-provided information is verified through lender websites and interviews. We also utilized 2020 HMDA data for origination volume, origination fee, rate spread and share-of-product data.

To recap our selections...

NerdWallet's Best Mortgage Lenders with Low Origination Fees of 2022

Frequently asked questions