Yes, you are correct. If it is based on a percentage of the loan, then it is deductible. Normally, an origination fee is based on the loan value. It is rare to be called an "origination fee" if that is not the case. Points aka Origination fees can be called several different names on the settlement sheet so I have to clarify that it is only deductible if it is based on loan value. Therefore, anytime you have a "fee" that you think might be considered a deductible point/origination fee (but might be listed as a different name such as a "maximum loan charge", it is only deductible as an "origination fee" if it is a percentage of the loan value. If yours is listed as an origination fee, you can be comfortable knowing it is deductible...spread out over the term of the loan.
