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How much a "point" is when it comes to closing costs on a home?

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Final answer:

A "point" refers to a percentage of the total loan amount that you pay upfront to the lender at closing, in exchange for a lower interest rate on your mortgage.

Step-by-step explanation:

When it comes to closing costs on a home, a "point" refers to a percentage of the total loan amount. It is a fee that you pay upfront to the lender at closing in exchange for a lower interest rate on your mortgage. One point is equal to 1% of the loan amount. For example, if you are borrowing $200,000, one point would be $2,000.

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