Origination Fee vs. Points
by Dan Persfull and Richard Insley, BOL Gurus Guru BIOS
Question: Can the terms Origination Fee and Points be used interchangeably? Some think they are the same. But isn't an origination fee a fee for the work done to make a loan and Points a fee for a price reduction on the loan? What, if any, are the RESPA implications with using them interchangeably?
Answer by Dan Persfull: You have Origination Fee points and you have Loan Discount points - points primarily refers to what percentage of the loan will be charged for either the Origination Fee or the Loan Discount, or both.
As long as they are properly disclosed either in line 801 or 802 on the settlement statement, there is no RESPA implications I can think of.
Answer by Richard Insley: Are both deductible? (It's been 31 years since I bought a house.) If not, then is the HUD-1 used to substantiate the deduction?
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