saving money: Points-they matter - 11/03/08 07:08 AM
Points or "buying down" the rate is becoming more typical than before. Guidelines have constricted and the cost of borrowing money for even the best of customer's has increased.
Typically, one point is equivalent to 1% of the loan amount. Lets exemplify this and we will assume that a borrower is putting 10% down on a $200,000 home. Their credit falls into the average category now for a "conforming" loan with their respective score being a 661. The loan amount proposed then, assuming they are covering their own closing costs is now $180,000. They have a "pricing add-on" of .1% for the loan size (less than $200,000), they … (14 comments)




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