Finance
A discount point paid at loan origination is equal to:
A1% of the appraised value
B1% of the loan amount✓ Correct
C$1,000 regardless of loan size
D0.25% of the purchase price
Explanation
One discount point equals 1% of the loan amount. Borrowers pay points at closing to reduce (buy down) the interest rate on their mortgage. Each point typically reduces the rate by approximately 0.25%.
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