Mortgage Points

Welcome to Mortgage Points. Our site offers a definition of Mortgage Points and breaks out when you should or should not consider buying Mortgage Points for financing a home. Mortgage Points are not for everyone and a number of factors may be considered in assessing if Mortgage Points are right for you.

What are Mortgage Points?
A mortgage point, also called a discount point, is an opportunity for you to pay some of your mortgage interest up front. If you purchase mortgage points upfront from your bank your interest rate will drop and stay lower throughout the life of the loan. A mortgage point costs one percent (1%) of the mortgage amount. Plus, if you meet the requirements, you may qualify for a Mortgage Points Deduction when you pay your income taxes. For a more in-depth explanation of what mortgage points are, and how they work, visit What are Mortgage Points?

 

What You Should Consider...
Do you have enough money to pay for mortgage points up front?
If you are low on cash, it may be in your best interest to forgo buying mortgage points.

 

How long will you need to keep the mortgage in order to reap the benefits?
It will often take a few years before you realize the value of buying mortgage points. However, points purchased up front can often equate to thousands of dollars saved.

 

Our Mortgage Points Calculator here at Mortgage Points can help you determine whether or not buying points is a good idea for you. You will need to prepare the following figures and input them into the calculator: your original interest rate, your new interest rate with mortgage points, number of mortgage points, your mortgage amount, and the term length of the mortgage. Your bank can provide you with the revised interest rate percentage through purchasing mortgage points. Not all banks offer the same terms.

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