Underwriting Fee Law and Legal Definition

Underwriting fee is that portion of the gross underwriting spread that compensates the securities firms that underwrite a public offering for their services. It is also a fee charged by the lender to verify information on the loan application, authenticate the property's worth as collateral, and make a final determination about whether to grant a loan to the applicant. It is an investor fee for underwriting of the loan.

The underwriting fee includes the total cost pertaining to the evaluation and estimation of a loan, an individuals credit report and its latest status in order to determine his/her credit worthiness as an applicant for a loan.