Our bank charges a 1% origination fee to the borrower on our mortgage loans. We are considering collecting an undewriting fee and a processing fee in addition to the 1% origination fee.
Other lenders have told us that, per regulations, we can not charge an origination fee AND charge the underwriting and processing fees. We were told that you have to do one or the other.
However, we were told that you may charge a discount point and also charge the underwriting and processing fee. But in order to do that, the borrower would have to receive a lower rate than what he/she would receive had they not elected to pay a discount point.
One of the other lenders who gave us this information is an affiliated Mortgage Company and not a bank.
No one has been able to point us to a specific regulation that will clarify this for us.
1) Can you charge and origination fee in addition to the underwriting and processing fees?