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What is the difference between origination fees, discount points, and lender credits on my Loan Estimate?

Origination fees are what the lender charges to process and underwrite your loan, listed in section A of the Loan Estimate; they cover the lender's work regardless of your rate. Discount points are optional prepaid interest you pay to buy down your rate, expressed as a percentage of the loan, where one point equals 1% of the loan amount. Lender credits are the opposite: money the lender gives you toward closing costs in exchange for a higher rate. When comparing lenders, look at all three together, since one lender may quote a low rate but high origination fees, while another offers credits. The APR blends these into one comparable figure, but always verify the actual dollar amounts in section A.

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