The fee charged by a lender to initiate and complete the loan process, usually computed as a percentage of face value of the loan.
One point equals one percent of the loan amount. Points are used to lower the interest rate. One point does not equate into lowering the interest rate one percent. Typically is tax deductible
A fee imposed by a lender to cover certain processing expenses in connection with making a real estate loan. Usually a percentage of the amount loaned, such as one percent.