Points are fees that a borrower pays directly to their lender at their closing, in exchange for a lower interest rate. 1 point is 1% of the mortgage amount. As a rule of thumb, 1 point will typically decrease your interest rate around ¼ of a percent. Paying points is also known as “buying down the rate.”

While many people tell us “I don’t like to pay points”, we look at the math. At Morgan Financial we will do a cost benefit analysis to determine if the cost of buying down the interest rate is worth it to our clients in the reduction of payment.

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