Gourt Home::Gourt :: Point (mortgage)
A point, sometimes also called an "origination fee" or a "discount point", is a fee for establishing a new loan. It is one of the important factors in the calculation of the annual percentage rate for a mortgage. One point is one percent of the loan amount.
The fee usually varies from 0.5% (half a point) to 2% (two points) of the loan amount, depending whether the loan was originated in the prime or the subprime market.
An origination fee of 2% on a $200,000 loan is $4,000. In some cases, one has to pay points plus origination fees.
If for a $100,000 loan, the * points are 1.5, then one pays $1,500 in points because .
"Point (mortgage)"