Finance
Points paid at closing to reduce the mortgage interest rate are called:
AOrigination fees
BDiscount points✓ Correct
CPrepayment points
DService release premiums
Explanation
Discount points are prepaid interest paid at closing to buy down the loan's interest rate; one point equals 1% of the loan amount.
Related New Jersey Finance Questions
- A NJ home equity line of credit (HELOC) is typically secured by:
- A NJ lender requires a borrower to pay 2 discount points on a $280,000 mortgage. How much will the borrower pay at closing for the points?
- The maximum conventional loan-to-value (LTV) ratio that avoids private mortgage insurance (PMI) is typically:
- A New Jersey condominium buyer who obtains an FHA loan will be required to pay:
- A balloon mortgage requires the borrower to:
- A NJ buyer's monthly gross income is $8,500. The maximum monthly housing expense allowed under a 28% front-end ratio is:
- USDA Rural Development loans offer which benefit to qualified borrowers?
- A New Jersey 'purchase money mortgage' (PMM) is one where:
Practice More New Jersey Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free New Jersey Quiz →