FinancingEASY
Mortgage points (discount points) are:
Correct Answer
C) Fees reducing interest rate
Discount points are prepaid interest paid at closing to reduce the loan's interest rate. One point equals 1% of the loan amount and typically reduces the rate by 0.25%.
Answer Options
A
Fees reducing down paymentB
Government down payment discountsC
Fees reducing interest rateD
Government interest discountsAudio Lesson3 min
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Related Topics & Key Terms
Related Topics:
loan-origination-feesapr-calculationmortgage-qualificationclosing-costs
Key Terms:
discount pointsmortgage pointsprepaid interestinterest rate buydownclosing costs
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