Information about Point (mortgage)
A point, sometimes also called a "discount point", is one of the important factors in the calculation of the annual percentage rate for a mortgage loan. One point is one percent of the loan amount.
If for a $100,000 loan, the [percentage] points are 1.5, then one pays $1,500 in points because
.
Discount points are not to be confused with an origination fee. Discount points differ from origination fees in that discount points are used to buy down the interest rates, temporarily or permanently. Origination Fee and Discount Points are both items listed under lender-charges on the HUD-1 Settlement Statement.
The difference in savings over the life of the loan can make paying points a benefit to the borrower. If you intend to stay in your home for an extended period of time, it may be worthwhile to pay additional points in order to obtain a lower interest rate. Any significant changes in fees should be re-disclosed in the final Good Faith Estimate (GFE).
If for a $100,000 loan, the [percentage] points are 1.5, then one pays $1,500 in points because
.
Discount points are not to be confused with an origination fee. Discount points differ from origination fees in that discount points are used to buy down the interest rates, temporarily or permanently. Origination Fee and Discount Points are both items listed under lender-charges on the HUD-1 Settlement Statement.
The difference in savings over the life of the loan can make paying points a benefit to the borrower. If you intend to stay in your home for an extended period of time, it may be worthwhile to pay additional points in order to obtain a lower interest rate. Any significant changes in fees should be re-disclosed in the final Good Faith Estimate (GFE).
Annual Percentage Rate (APR) is an expression of the effective interest rate that the borrower will pay on a loan, taking into account one-time fees and standardizing the way the rate is expressed.
..... Click the link for more information.
..... Click the link for more information.
A mortgage loan is a loan secured by real property through the use of a mortgage (a legal instrument). However, the word mortgage alone, in everyday usage, is most often used to mean mortgage loan.
..... Click the link for more information.
..... Click the link for more information.
An origination fee is a fee for establishing a new loan. This fee is paid to the bank or your loan broker for his or her services in originating the loan.
The fee usually varies from 0.
..... Click the link for more information.
The fee usually varies from 0.
..... Click the link for more information.
This article is copied from an article on Wikipedia.org - the free encyclopedia created and edited by online user community. The text was not checked or edited by anyone on our staff. Although the vast majority of the wikipedia encyclopedia articles provide accurate and timely information please do not assume the accuracy of any particular article. This article is distributed under the terms of GNU Free Documentation License.
Herod_Archelaus
