Loan processing fees are usually charged to cover the costs of processing and sanctioning the loan. They are typically a small percentage of the total loan amount, but they vary from bank to bank. Ideally, you want to find a loan with no origination fee or a low one. What to Look for When Searching for the Best Loan   Other fees to look out for include prepayment penalties. These fees are often charged when you pay back your loan early, and they can quickly add up. To avoid these fees, choose a long-term loan term. While this will increase your monthly payments, you will save money in the long run by paying less interest.