Loan Application Fee

Categories: Credit, Banking

Some things are just not what they seem. For example, lead pencils? They don’t have any lead in them. It’s graphite.

But one thing that happens to be 100% exactly what it seems like it would be is a loan application fee.

A “loan application fee” is a fee we pay to our potential lender if we want the bank or financial institution to process our loan application. These fun little fees are often nonrefundable and are due up front, just like college application fees. And just like college application fees, if we’re pretty sure we’re not going to get what we’re applying for—i.e., we’re applying to an Ivy League school with a 2.2 GPA and our parents aren’t rich enough to hire someone to photoshop us onto a crew team and help us cheat our way in—then we could be wasting a lot of money.

Find other enlightening terms in Shmoop Finance Genius Bar(f)