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8 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.

May 9, 2022

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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

NASB
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at NASB

NASB: NMLS#400039

5.0

NerdWallet rating 
NASB

Min. credit score

620

Min. down payment

3%
Learn more

at NASB


Why we like it

NASB couples competitive mortgage rates and reasonable fees with a good assortment of loan options.

Pros

  • Offers competitive rates and origination fees.

  • Considers nontraditional income sources, in some cases.

Cons

  • Does not offer home improvement mortgages.

  • Doesn't offer home equity loans and lines of credit.

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Veterans United
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at Veterans United

Veterans United: NMLS#1907

4.5

NerdWallet rating 
Veterans United

Min. credit score

620

Min. down payment

0%
Learn more

at Veterans United


Why we like it

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

Pros

  • Offers 24/7 customer service over the phone.

  • Has online application and pre-qualification.

  • Offers a free credit counseling service.

  • Employs advisors from each branch of the armed forces.

Cons

  • Doesn’t offer home equity loans or HELOCs.

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

  • Information on FHA, USDA and conventional loans is harder to find on its website.

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NBKC
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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 with solid credit who want to pay low rates and get an online experience with phone support. VA loans are an emphasis.

Pros

  • Extends full online capabilities, from application to loan tracking.

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

Cons

  • Equity lines and construction loans are available only in the Kansas City metro area.

  • Doesn’t offer renovation loans.

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BNC National Bank
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at BNC National Bank

BNC National Bank: NMLS#418467

4.5

NerdWallet rating 
BNC National Bank

Min. credit score

640

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

  • Wide variety of loan types and products.

  • Improved online capabilities, and robust iOS and Android apps.

  • Considers alternative credit data, like cell phone payments.

Cons

  • Limited number of physical mortgage offices.

  • Limited rate information is available without starting an application or speaking with a loan officer.

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Better
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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

  • An online process with human help as needed.

  • Makes it easy to see customized mortgage rates.

  • Offers an "underwriter reviewed" preapproval letter in as little as 24 hours.

  • Appraisal guarantee promises the loan won’t change even if appraisal is lower than expected.

Cons

  • Doesn't offer home equity loans or HELOCs.

  • Doesn't do VA or USDA loans.

  • Appraisal guarantee is limited to borrowers who use Better real estate agents.

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PenFed: NMLS#401822

4.5

NerdWallet rating 
PenFed

Min. credit score

620

Min. down payment

3%

Why we like it

PenFed Credit Union has a digital mortgage application and offers a wide selection of mortgages, including low-down-payment home loans. But it doesn't offer FHA mortgages.

Pros

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

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

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

Cons

  • Lender credit isn't available for refinance mortgages.

  • Doesn't offer FHA or home improvement loans.

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Citibank: NMLS#412915

4.5

NerdWallet rating 
Citibank

National / regional

National

Min. down payment

3%

Why we like it

Good for: existing Citibank customers, as well as borrowers eligible for the low-down-payment HomeRun mortgage.

Pros

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

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

Cons

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

  • Customized mortgage rates not available without making contact.

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LenderFI: NMLS#133056

5.0

NerdWallet rating 
LenderFI

Min. credit score

620

Min. down payment

3%

Why we like it

Good for: borrowers who want a completely online experience when buying or refinancing.

Pros

  • Has a full suite of online capabilities, including application, document uploading and process updates.

  • Site displays many combinations of loans and interest rates.

  • Rates and fees are lower than most lenders, according to the latest data.

Cons

  • Home equity loans and lines of credit, as well as purchase-renovation loans, aren't options.

  • VA loans are currently unavailable.

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 9, 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