<--Back to Wiki Home
In real estate, a point refers to a percentage of a loan amount that a lender charges as a finance fee. One point is typically equal to one percent of the loan amount.
Let's say that a homebuyer is borrowing $200,000 to purchase a home, and the lender charges one point as a finance fee. That means that the buyer would need to pay an additional $2,000 upfront as part of the loan closing costs.
"Wit & Whimsy with the Dumb Ox: Unlocking Knowledge with Rhyme:"
A point is a fee, small but true,
One percent of loan charged to you.
Paid upfront at closing time,
A lender's finance charge in its prime.