Real estate math and exam guide
Discount points and yield: calculate the dollars before comparing the rates
A loan costs 1.5 points. A different offer includes a lender credit. The question asks how long the lower payment takes to recover the extra upfront cost. Start by naming each amount. A point charge, a rate change and a month of savings use different units.
Last reviewed:
The short answer
One mortgage point equals 1% of the loan amount. Point cost = loan amount × points ÷ 100. To reverse it, points = charge ÷ loan amount × 100, or loan amount = charge ÷ the points decimal. True discount points purchase a lower rate, but there is no universal rate reduction per point. For a simple break-even comparison, divide the extra upfront cost of one stated option over the other by its positive monthly savings. A supplied classroom yield convention is a problem assumption, not an actual mortgage-yield formula.
Reviewed October 27, 2026. PSI names discount points and loan origination fees in national XI.B.4, Real Estate Calculations. The whole broker calculations domain has seven scored questions, with no guaranteed points-question quota. These original exercises use supplied figures, not current rate quotes, official PSI items or a recommendation to buy points. Disclosure rounding, actual loan pricing, economic return and tax treatment have their own requirements.
Choose the unknown and keep its unit attached
- Establish the point base. Use the loan amount, not the purchase price, down payment or monthly payment. If only price and down payment are supplied, calculate the loan first and account for any expressly financed items. A percentage-based fee can use similar arithmetic without being a discount point.
- Convert the quote once. A quote of 1.5 points means 1.5%, or 0.015 of the loan. A quote of 0.625 points means 0.625%, or 0.00625. Do not multiply the loan by 1.5 or confuse 0.625 points with 62.5%.
- Use the correct reverse calculation. Divide the point charge by the loan amount and multiply by 100 to find the points quote. Divide the charge by the points decimal to find the loan amount. That last operation requires a nonzero points figure; a zero charge at zero points does not reveal the loan balance.
- Read what the charge buys. On the identified mortgage disclosures, the separately labelled discount-points line concerns points paid to reduce the rate. Other origination charges can pay for extending or originating credit. Zero points does not mean zero origination charges or no closing costs.
- Compare equivalent pricing facts. True discount points generally mean more paid upfront for a lower rate on a comparable offer. Rate-linked lender credits generally reverse that tradeoff. Some lender credits are unrelated to the rate, such as compensation for a problem. Compare the actual quoted loan amount, term, rate type, lock assumptions and other charges; the word credit alone does not establish the whole deal.
- Calculate incremental simple break-even. Find the difference in upfront costs between the stated options, including a credit you would give up. Divide that additional amount by the stated positive monthly savings. If the question asks for the first full payment month, round a fractional number of months up. This shortcut does not account for time value, different remaining principal balances, taxes, changed payments or other costs unless expressly included.
- Keep note rate, APR and yield separate. A discount point is a dollar charge based on the loan; a percentage point and a basis point describe a rate or percentage difference. APR is a regulated credit-cost measure. Actual return depends on the cash advanced and amounts and timing received, not merely a point count added to the note rate. Apply a one-eighth-per-point classroom convention only when the question explicitly supplies it.
- Verify with a benchmark and the required rounding. One point on $300,000 is $3,000, so half a point is $1,500. Reverse the arithmetic before choosing an answer. Retain the quoted precision and follow the exercise’s final rounding instruction; actual disclosure rounding rules can differ from a classroom request for cents.
| Find | Use | Check |
|---|---|---|
| Cost in dollars | Loan × points ÷ 100 | 1.5 points means 0.015 |
| Points quote | Charge ÷ loan × 100 | The answer is points, not dollars |
| Loan amount | Charge ÷ (points ÷ 100) | The points divisor must be nonzero |
| Loan from price | Price − stated down payment | Include expressly financed items as directed |
| Additional upfront cost | Cost of chosen option − cost of comparator | A forgone lender credit can increase the difference |
| Simple break-even months | Additional upfront cost ÷ positive monthly savings | Round up if asked for the first full payment month |
| Rate difference | New rate compared with old rate | Use percentage points or basis points |
| Classroom yield calculation | Only the stated change per point | Not a universal actual-yield formula |
The distinctions that matter
| Distinction | How it works | What to notice |
|---|---|---|
| Discount point and rate percentage point | A discount point costs 1% of the loan; a rate percentage point measures a difference between rates. | A one-point charge does not imply a one-percentage-point rate reduction. |
| Percentage point and basis point | One basis point is 0.01 percentage point. | A 0.25-percentage-point reduction is 25 basis points. |
| Loan amount and property price | The loan is the point base; price may include the buyer’s separate equity contribution. | Calculate any stated down payment before pricing points. |
| Discount charge and down payment | One buys the quoted rate treatment; the other contributes toward the property price. | Paying points does not itself reduce principal. |
| Discount points and other origination charges | Both can appear within Origination Charges, but they do not necessarily buy the same thing. | A percentage origination fee is not automatically a rate discount. |
| Rate-linked credit and another lender credit | A credit tied to a higher rate differs from a credit given for another reason. | Read the actual pricing and disclosure, not just a negative sign. |
| Point cost and incremental upfront cost | Point cost is one charge; a comparison may also include a forgone credit or different fees. | Use the actual difference between the two options. |
| Simple break-even and complete economic comparison | Equal accumulated nominal savings do not account for every timing, balance or tax difference. | Do not turn the shortcut into an automatic buying recommendation. |
| Stated yield convention and cash-flow return | A classroom rule operates because the question supplies it; economic return requires the stated cash flows and timing. | No unstated one-eighth rule. |
| Cost calculation and tax deduction | Finding the charge does not establish whether or when it is deductible. | The applicable tax-year rules and transaction facts matter. |
Work through the facts
Find the point cost
A $320,000 loan is quoted at 1.5 discount points. Find the charge.
- 1.5 ÷ 100 = 0.015.
- $320,000 × 0.015 = $4,800.
- One point is $3,200; another half point is $1,600.
Answer: The charge is $4,800. The calculation does not tell you the offered rate reduction.
Recover the points quote
A $350,000 loan has a $4,375 discount-point charge. Find the quoted points.
- $4,375 ÷ $350,000 = 0.0125.
- 0.0125 × 100 = 1.25.
Answer: The charge equals 1.25 points. Do not call the result 0.0125 points or $1.25.
Recover the loan amount
Two points cost $6,000. No other fee is included in that charge. Find the loan amount.
- 2 points = 0.02 of the loan.
- $6,000 ÷ 0.02 = $300,000.
Answer: The loan amount is $300,000. Dividing the charge by the whole number two would produce the cost of one point, not the loan.
Calculate the loan before the charge
A buyer pays 20% down on a $450,000 property. The loan finances the remaining price, with no other financed amount. The quoted charge is 0.75 points.
- Down payment: $450,000 × 20% = $90,000.
- Loan: $450,000 − $90,000 = $360,000.
- Points: $360,000 × 0.0075 = $2,700.
Answer: The point charge is $2,700. Using the full price would overstate it.
Include the credit given up
Assume comparable fixed-rate offers with the same $300,000 principal and term. Option A charges one point and gives no lender credit. Option B charges no points and gives a $1,500 lender credit. Option A saves $90 a month in stated principal and interest. All other upfront charges are identical; use only the requested simple comparison.
- Option A’s point charge is $300,000 × 0.01 = $3,000.
- Relative to Option B, its extra upfront cost is $3,000 − ( − $1,500) = $4,500.
- $4,500 ÷ $90 = 50 months.
Answer: Simple break-even is 50 months. Dividing only the $3,000 point charge by savings would ignore the credit forgone. The exercise is not a complete economic comparison of the actual loans.
Choose the first full payment month
For a simplified comparison, extra upfront cost is $4,387.50 and savings are $85 after each full monthly payment. Find the first payment month when accumulated nominal savings meet or exceed that cost.
- $4,387.50 ÷ $85 = approximately 51.617647 months.
- After 51 payments, savings are $4,335; after 52, they are $4,420.
Answer: The first full payment month is 52. The fractional quotient can be shown as 51.62 months, but rounding it down to 51 would not recover the stated cost.
Use only the stated classroom convention
A teaching question expressly says each point adds 0.125 percentage point to lender yield for its calculation. The note rate is 6%, the desired convention-based yield is 6.375%, and the loan is $280,000.
- Stated gap:6.375% − 6% = 0.375 percentage point.
- Under the supplied rule:0.375 ÷ 0.125 = 3 points.
- Charge: $280,000 × 0.03 = $8,400.
Answer: The stipulated convention produces 3 points and $8,400. It is not a claim that actual mortgage return or pricing follows a fixed one-eighth rule.
Calculate a one-year return from actual supplied cash flows
This hypothetical has exactly one one-year period, no interim payments and no other fees, expenses, losses or cash flows. A lender advances $100,000 at time zero and simultaneously retains $2,000 in points, giving a net initial outlay of $98,000. Exactly one year later, the lender receives $100,000 principal and $6,000 interest.
- Final receipt: $100,000 + $6,000 = $106,000.
- Gain over the stated net outlay: $106,000 − $98,000 = $8,000.
- One-period return: $8,000 ÷ $98,000 × 100 = approximately 8.163265%.
Answer: Under these exact assumptions, the one-year return is approximately 8.16%. It is neither 6% plus an assumed one-eighth per point nor a calculation of an actual multi-payment mortgage’s return. The example is not a compliant APR disclosure or profit calculation after unstated operating expenses.
Finance points only under the expressly stated final-balance assumption
This algebra exercise expressly permits financing the points and defines them as 2% of the final note balance. The desired net amount after those points is $294,000. There are no other financed fees, advances or deductions. Find the final note balance; do not assume an actual program permits the arrangement.
- Let L be the final note amount. Net proceeds are L − 0.02 L = 0.98 L.
- Solve 0.98 L = $294,000, so L = $294,000 ÷ 0.98 = $300,000.
- The points are $300,000 × 0.02 = $6,000, leaving $294,000.
Answer: The stated final note is $300,000. Simply adding 2% of $294,000 would use the wrong base for this exercise. Actual permission, limits and pricing are separate; this is not a recommendation to finance points.
Add points to a supplied closing ledger once
Assume the earlier $450,000 price, $90,000 down payment, $360,000 loan and $2,700 points. Other closing costs are $6,000, expressly excluding points. A $10,000 deposit and a permitted $1,500 seller credit apply once and are not already included in another figure. All other adjustments are zero for this exercise.
- Buyer costs before credits: $90,000 + $6,000 + $2,700 = $98,700.
- Remaining cash: $98,700 − $10,000 − $1,500 = $87,200.
Answer: The supplied remaining cash to close is $87,200. The point charge is not another down payment or a principal reduction, and the seller credit is not automatically a rate-linked lender credit.
Mistakes to avoid
- Use price as the point base. Use the loan amount and account for the expressly financed items.
- Multiply by 1.5 for 1.5 points. Use 0.015, because the quote is a percentage.
- Divide by 2 to recover a two-point loan. Divide by 0.02.
- A one-point charge guarantees a fixed rate reduction. Use the actual quoted rate alternatives.
- Every lender credit buys a higher rate. Some are unrelated to rate; read the actual reason and pricing.
- Zero points means no closing costs. Other origination and transaction charges can remain.
- Subtract points from principal as though they were a down payment. A point charge is a loan cost; any financing treatment must be supplied.
- Use point cost alone when the other option gives a credit. Calculate the difference in total relevant upfront costs.
- Round a break-even fraction down to a full payment month. Round up when the question asks when full monthly savings first cover the cost.
- One point always adds an eighth to yield. A classroom convention must be explicitly stated; actual return depends on cash flows and timing.
- APR equals note rate plus points. Its regulated calculation depends on applicable amounts, charges and timing.
- Every charge called points is deductible immediately. Tax labels, services, loan purpose, applicable year and deduction conditions matter.
Check your understanding
These are original teaching questions, not recalled or predicted PSI questions. Answer first, then explain why the other choices fail.
1. A $280,000 loan carries 1.25 discount points. What is the charge?
- $35,000
- $2,240
- $3,500
- $2,800
Show answer and explanation
Answer: C. $3,500
$280,000 × 0.0125 = $3,500. The loan amount is the base.
2. Which decimal represents 0.625 points?
- 0.0000625
- 0.625
- 0.00625
- 0.0625
Show answer and explanation
Answer: C. 0.00625
Divide the percentage quote 0.625 by 100. It equals 0.00625 of the loan, not 62.5%.
3. A $350,000 loan has a $4,375 points charge. What is the quote?
- 1.25 points
- 125 points
- 12.5 points
- 0.0125 points
Show answer and explanation
Answer: A. 1.25 points
Divide 4,375 by 350,000 and multiply by 100. The quote is 1.25 points.
4. Two points cost $6,000, with no other charge included. What is the loan?
- $600,000
- $300,000
- $3,000
- $12,000
Show answer and explanation
Answer: B. $300,000
Use $6,000 ÷ 0.02. Dividing by 2 instead finds a one-point charge rather than the loan.
5. A $450,000 purchase has 20% down and no other financed items. At 0.75 points, what is the charge?
- $27,000
- $3,375
- $2,700
- $675
Show answer and explanation
Answer: C. $2,700
The supplied loan is $360,000; multiply by 0.0075 to get $2,700.
6. On a $400,000 loan, a separate $3,000 origination fee and $4,000 discount charge are shown. Which statement is correct?
- The origination fee necessarily buys a lower rate
- Both charges are a down payment
- They use similar percentage math but do not necessarily buy the same service or rate treatment
- The total charge automatically makes the discount quote 1.75 points
Show answer and explanation
Answer: C. They use similar percentage math but do not necessarily buy the same service or rate treatment
The fee is 0.75% and the separately supplied discount charge is 1%. Do not relabel their $7,000 sum as discount points when their purposes differ.
7. No rate sheet or rate-change convention is supplied. What change should be assumed for one point?
- One percentage point
- 0.125 percentage point
- 0.25 percentage point
- No fixed rate reduction
Show answer and explanation
Answer: D. No fixed rate reduction
The dollar definition is fixed at 1% of the loan; the rate effect is not a universal conversion.
8. A quoted rate falls from 6.50% to 6.25%. What is the rate difference?
- 0.25 percentage point, or 25 basis points
- 2.5 percentage points
- 0.25% of the original rate
- One discount point
Show answer and explanation
Answer: A. 0.25 percentage point, or 25 basis points
Subtract the rates to get 0.25 percentage point, then multiply by 100 to express that difference as 25 basis points. It does not state the dollar cost in discount points.
9. Does every lender credit necessarily come from a higher interest rate?
- No; some are unrelated to rate, so examine the actual offer
- Yes, without exception
- No, because all are down payments
- Only seller credits can reduce closing costs
Show answer and explanation
Answer: A. No; some are unrelated to rate, so examine the actual offer
The CFPB identifies unrelated credits, including temporary offers or compensation for a problem. Rate-linked credits have the stated pricing tradeoff.
10. One $300,000 offer charges one point with no credit; the comparator has zero points and a $1,500 lender credit. Other upfront charges match. What is the first offer’s extra upfront cost?
- $1,500
- $4,500
- $3,000
- $1,500 less
Show answer and explanation
Answer: B. $4,500
The first costs $3,000 more in points and gives up $1,500 in credit. Relative extra cost is $4,500.
11. That extra upfront cost is $4,500 and the stated monthly savings are $90. What is simple break-even?
- 90 months
- 33.33 months
- 450 months
- 50 months
Show answer and explanation
Answer: D. 50 months
Divide the actual upfront difference by positive monthly savings:4,500 ÷ 90 = 50. This is a nominal shortcut, not a complete loan comparison.
12. Extra upfront cost is $4,387.50 and savings arrive in full $85 monthly amounts. What is the first payment month with enough accumulated savings?
- 51.62 as a completed payment month
- 52
- 50
- 51
Show answer and explanation
Answer: B. 52
The quotient is about 51.617647, so 52 full payments are required;51 × 85 is only $4,335.
13. Under the expressly supplied 0.125-per-point convention, a 0.375-percentage-point gap requires how many points?
- 0.375 point
- 8 points
- 0.125 point
- 3 points
Show answer and explanation
Answer: D. 3 points
Divide the stated gap 0.375 by the stipulated 0.125-per-point effect. The result is conditional on that teaching convention.
14. What is the charge for those 3 points on the $280,000 loan?
- $2,800
- $84,000
- $8,400
- $840
Show answer and explanation
Answer: C. $8,400
Three points means 0.03 of $280,000, or $8,400. That is the point charge, not an APR calculation.
15. In the one-year cash-flow example, the lender advances $100,000 and immediately retains $2,000. What is the stated net initial outlay?
- $102,000
- $98,000
- $100,000
- $106,000
Show answer and explanation
Answer: B. $98,000
Net outlay at time zero is $100,000 − $2,000 = $98,000. The example expressly supplies simultaneous retention and no other flows.
16. In that same one-year example, what is the return on the $98,000 outlay when $106,000 arrives exactly one year later?
- Approximately 8.16% under the supplied cash flows
- 6% in every case
- Exactly 8% from adding points to the note rate
- 6.25% from an unstated yield shortcut
Show answer and explanation
Answer: A. Approximately 8.16% under the supplied cash flows
The one-period gain is $8,000 and $8,000 ÷ $98,000 is about 8.163265%. Do not substitute it for an actual mortgage’s multi-payment return or regulated APR disclosure.
17. An exercise asks for cents:0.625 points on $312,345. What is the point charge rounded only at the end?
- $19,521.56
- $1,952.16
- $195.22
- $1,952.00
Show answer and explanation
Answer: B. $1,952.16
Multiply $312,345 by 0.00625 to get $1,952.15625, then round the final result to $1,952.16. This question asks for classroom cents, not a completed Loan Estimate disclosure.
18. For the identified Loan Estimate origination-charge dollar rule, how would an exact $1,952.15625 charge be displayed?
- As the quoted interest rate
- $1,952.16 in every mortgage disclosure
- $1,953, always rounded up
- $1,952, rounded to the nearest whole dollar
Show answer and explanation
Answer: D. $1,952, rounded to the nearest whole dollar
The identified Loan Estimate rule uses nearest-whole-dollar origination-charge amounts. That differs from a classroom question explicitly requesting cents and does not describe every Closing Disclosure amount.
19. The financed-points exercise requires $294,000 net after 2% of the final note balance is deducted. With no other flows, what is the final note?
- $288,120
- $299,880
- $300,000
- $294,000
Show answer and explanation
Answer: C. $300,000
Solve L × 0.98 = $294,000. The result is $300,000, with $6,000 points. The exercise supplies financing permission rather than establishing actual program eligibility.
20. Down payment is $90,000; other costs excluding points are $6,000; points are $2,700. Apply a $10,000 deposit and separate permitted $1,500 seller credit once. What remaining cash is needed?
- $98,700
- $87,200
- $88,700
- $84,500
Show answer and explanation
Answer: B. $87,200
Add 90,000 +6,000 +2,700, then subtract 10,000 and 1,500. No item is already included in another figure, and the exercise supplies no other adjustment.
Common questions
What is one mortgage point?
One percent of the loan amount. One point on $320,000 is $3,200; half a point is $1,600. The definition fixes the dollar relationship, not the offered change in interest rate. Fractional points use the same relationship.
What is the formula for discount points?
Charge = loan amount × points ÷ 100. For 1.5 points on $320,000, use $320,000 × 0.015 = $4,800. If a question gives only price and down payment, find the loan amount first, including any expressly financed items. Do not use the property price or the down payment as the point base.
How do I find points from a dollar charge?
Divide the charge by the loan amount, then multiply by 100. A $4,375 charge on $350,000 is 0.0125 of the loan, or 1.25 points. Keep the unit:0.0125 is the decimal multiplier, while 1.25 is the points quote.
How do I find the loan amount from points?
Divide the charge by the points decimal. If 2 points cost $6,000, calculate $6,000 ÷ 0.02 = $300,000. The points figure must be nonzero for this reversal. Zero points and a zero charge do not reveal a unique loan amount.
Does one point always lower the rate by 0.25 percentage point?
No. Use the actual rate sheet or the comparison supplied in the question. The lender, loan type and market affect the rate reduction. A 1% loan charge, a 0.25-percentage-point rate difference and a 0.25% relative change in a rate describe different things.
Are discount points and origination fees the same?
Not automatically. A fee for originating or extending credit can be a percentage of the loan without purchasing a rate reduction. The identified disclosures separately label points paid to reduce the rate. The same multiplication can calculate both charges, but their purpose and label still differ. Zero discount points does not mean there are no other loan or closing costs.
Where do discount points and lender credits appear?
For the identified standard Loan Estimate and Closing Disclosure, points are on page 2, Section A, within Origination Charges. The separately labelled points line is tied to a rate discount. Lender credits appear as a negative amount on page 2, Section J, and reduce the stated closing costs. Seller credits are different and need their own treatment. These locations do not replace checking the actual applicable disclosure and transaction.
Does a lender credit always mean a higher rate?
Rate-linked credits generally trade a higher rate for lower upfront costs on a comparable offer. The CFPB also identifies credits unrelated to the interest rate, such as a temporary offer or compensation for a problem. Ask what the particular credit represents and compare the complete stated pricing; do not infer every term from a worksheet’s negative-points label.
How do I calculate simple break-even for points?
Divide the extra upfront cost of the lower-payment option over the comparator by its positive monthly savings. With identical other costs and no credits, a $4,000 extra charge and $80 monthly savings give 50 months. If the comparator has a credit or different fee, include that in the difference. A zero monthly saving does not produce a finite recovery time for a positive extra cost in this shortcut.
Should I round a break-even result up?
If the question asks for the first full monthly payment when savings recover the cost, yes: a quotient of 51.617647 means 52 full payment months. If it asks for a fractional number of months, report the quotient to the instructed precision. Do not confuse that nominal calculation with a complete recommendation about how long to keep an actual loan.
What does simple break-even leave out?
Among other differences, the timing and alternative use of money, taxes, remaining principal balances, a sale or refinance, changing payments and costs outside the supplied comparison. The lower-payment loan can amortise differently even when principal and term match. The shortcut answers the stated arithmetic question; it does not prove which actual offer has the lowest total economic cost.
Do points increase lender yield by one-eighth of a percent each?
Only use that relationship when a teaching question explicitly gives it. State its unit as a percentage-point change per discount point. Actual cash-flow return depends on what is advanced, what is received and when, including any applicable fees and repayment timing. A note rate plus an unstated points shortcut does not establish it. The one-year example above deliberately supplies every cash flow; it is not a real mortgage pricing formula.
Is APR the interest rate plus points?
No. APR is a regulated measure of applicable credit costs with required calculation methods that depend on amounts and timing. You cannot calculate it simply by adding a points quote to the note rate or dividing the fee by principal. Lender economic return is also a separate question; the one-year teaching return is not presented as an actual APR disclosure.
Are discount points automatically deductible in the year paid?
No. IRS guidance distinguishes the general timing treatment from qualifying circumstances permitting a deduction in the year paid, and charges for services are not made deductible interest merely by calling them points. Loan purpose, the home, payment and deduction conditions matter. The Publication 936 page retrieved for this review is the 2025 edition, not a complete 2026 return guide. This page teaches point arithmetic and does not calculate an actual tax deduction.
Should point costs be rounded to cents or whole dollars?
Follow the question’s instruction and keep precision until the final step. An exact 0.625-point charge on $312,345 is $1,952.15625, which becomes $1,952.16 when cents are requested. The identified Loan Estimate rule instead rounds origination-charge dollars to the nearest whole dollar and has separate precision requirements for the points percentage. Do not round 0.625 points to 0.63 before multiplying or assume every disclosure uses the same dollar precision.
Can points be financed into the mortgage?
An actual loan must meet its program, loan-amount, value and other applicable restrictions; this page does not establish permission. For an algebra question that expressly permits it and bases the charge on the final note amount, let r be the points decimal and N the desired net proceeds. Then final note = N ÷ (1 − r), for the stated valid divisor. If the fee is based on another expressly defined amount or other costs are financed, the equation changes. Financing the cost also changes the debt; it does not make the points free.
How do points affect the buyer’s cash to close?
Include the point charge in the stated closing-cost ledger once, with the down payment, other charges, financed amounts, deposit and permitted credits handled as the question directs. Do not subtract it from principal as though it were a down payment, or subtract a credit again when it already reduced a charge. A seller credit and a rate-linked lender credit have different sources and implications; neither is automatically unlimited or cash the buyer may receive regardless of program rules.
Are these official PSI questions or current mortgage quotes?
No. They are original teaching questions aligned with the named PSI calculation topic. The numerical loan amounts, rates, costs, payment differences and holding-period assumptions are supplied examples. The page does not promise a certain number of exam questions, a passing result, an actual lender price or the best offer for a particular borrower. Sources identify what was actually checked as of the October 27 review.
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Official sources and scope
Reviewed October 27, 2026. The record identifies the current CFPB passages and selected official definitions actually read, with the IRS publication’s 2025 edition stated. The original examples supply their own loan amounts, rates, credits, payment differences and timing. None is a current offer, a complete APR disclosure, a tax-return calculation or a prediction of investment performance.
- PSI June 24, 2026: National XI.A.1 seller net and XI.A.2 buyer funds
- CFPB: discount points, lender credits and actual pricing
- CFPB Regulation Z 1026.37: points, credits, cash to close and rounding
- Freddie Mac PMMS definitions: one-point amount
- SEC Investor.gov: basis-point definition
- IRS Topic 504: qualified mortgage-point tax treatment
- IRS Publication 936 (2025): selected points guidance
- Regulation Z 1026.22(a)(1): APR as a yearly cost measure
- CFPB: mortgage interest rate compared with APR
This is exam preparation, not advice for a specific transaction. State law and the applicable facts control. Our editorial and corrections process explains how to report an issue.