Discount Points

Fees that are collected by the lender in exchange for a lower interest rate.  Each discount point is 1% of the loan amount.  For our comparison purposes, a discount point is considered to be a lender fee.  To determine if it is wise to pay discount points to obtain a lower rate, you must compare the up front cost of the points to the monthly savings that result from obtaining the lower rate.  Sometimes referred to as "points".