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One "Point" equals 1% of the loan amount.
Points are two things: A. How the Loan Officer / Mortgage Advisor / Equity Consultant gets paid, and B. A way to trade for a lower rate with the bank. If you are certain you'll be in this mortgage (regardless of whether you live in the property, i.e. you may hold it for rental), you may wish to pay extra points in favor of a lower rate. The bank needs to make a certain amount of money, and you can pay that up front, or in the loan in the form of a higher rate.
Beware of people or companies who say they "don't charge points" - they are not working for free. Even if they work at a bank. Loans with a higher rate favor the bank, so they make more money over time. Generally speaking, retail banks are better on fees, while brokers are better on rate. Which is better for you?
Why not choose a Broker AND a Banker? You can!
Comet Funding is both a banker and a broker. That means we lend both our own money, and serve as an independent contractor for other banks as well. What does this mean for you? Well, when we use our own money we have more control, faster answers. If your scenario isn't a perfect match for our own products, we have our choice of literally hundreds of banks and thousands of programs.
What's the bottom line? Which one is for me?
Tell us a few details and we'll let you know how we can help you! |
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