"Points"

An upfront cash payment required by the lender as part of the charge for the loan, expressed as a percent of the loan amount; e.g., "3 points" means a charge equal to 3% of the loan balance. It is common today for lenders to offer a wide range of rate/point combinations, especially on fixed rate mortgages (FRMs), including combinations with negative points. On a negative point loan the lender contributes cash toward meeting closing costs. Positive and negative points are sometimes termed "discounts" and "premiums," respectively. See Mortgage Points and Rebates.

Mortgage glossary and terms by letter

A B C D E F G H I J K L M N O P Q R S T U V W Y Z 0

Was this page helpful? Yes: 0 No: 0 3