Discount Points
Discount points allow you to lower your interest rate. They are essentially prepaid interest, with each point equaling 1% of the total loan amount. One discount point equals 1%. So, for a loan amount of $100,000, the cost of 1 discount point would be an additional $1,000.00. We do not automatically charge discount points.
When shopping for loans, ask lenders for an interest rate with 0 points and then see how much the rate decreases with each point paid. Discount points are smart if you plan to stay in a home for some time since they can lower the monthly loan payment. Contact your Tax Professional to determine if the Points are tax deductible when you purchase a home.
Discuss this with our Loan Consultant and President, Kara Lowrie when you are locking in your interest rate if you are interested.