Should I Pay Points For A Lower Rate?
Paying points for a lower interest rate is a trade off between paying money now versus paying money later. A point - equaling 1% of the total loan amount - is an upfront fee that reduces your monthly interest rate and total interest due over the life of a loan. Use our calculator to figure out the cost and effective saving of loan points as well as the minimum amount of time it will take to recover your loan points.
Popular Mortgage Questions
Popular Mortgage Glossary Terms
A loan eligible for purchase by the two major federal agencies that buy mortgages, Fannie Mae and Freddie Mac. Conforming mortgages cannot exceed a legal maximum amount, which was $322,700 ...
The longest period for which the lender will lock the rate and points on any program. On most programs, the longest lock period is 90 days; some go to 120 days and a few to 180 days. It ...
A lenders requirements regarding how information about income and assets must be provided by the applicant and how it will be used by the lender. The following categories have evolved in ...
A borrower who must use tax returns to document income rather than information provided by an employer. ...
One of many interest rate indexes used to determine interest rate adjustments on an adjustable rate mortgage. ...
On an ARM, the assumption that the interest rate rises to the maximum extent permitted by the loan contract. ...
A plan purporting to protect FHA homebuyers against property defects. ...
Programs offered by some lenders under which a borrower who is able to secure a grant or gift equal to 2% of the down payment will only have to provide a 3% down payment from their own ...
The maximum allowable increase in the interest rate on an ARM each time the rate is adjusted. It is usually one or two percentage points. ...
Have a question or comment?
We're here to help.