Points (Mortgage Points)

Definition

Fees paid directly to the lender at closing in exchange for a reduced interest rate. One point costs 1% of your mortgage amount.

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Buying points is also known as "buying down the rate." It can save you money if you plan to stay in the home for a long time, as the monthly savings will eventually exceed the upfront cost.

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This tool is for illustrative purposes only and does not constitute professional financial, tax, or legal advice. Calculations are estimates and may not reflect real-world variables or local regulations. Always consult with a qualified professional before making financial decisions.