We want to know what your questions are about anything mortgage or real estate related.
Even if you’ve owned a home for years, there are still likely many misunderstood terms.
Today’s question is about points:
“What the heck are “points” and why are they so important? 20 yrs owning homes and I still don’t know the answer to that one.”
A point is equal to 1% of the principal amount of your mortgage.
For example, if you get a mortgage for $165,000 one point means $1,650 to the lender.
Points usually are collected at closing and may be paid by the borrower or the home seller, or may be split between them.
Want more in-depth info relating to origination points compared to discount points? Check out “What’s the Point?“