Tools & Resources

Discount Points

A percentage of the loan amount paid at closing. For instance, on a $90,000 loan amount, 1 point = 1%, or $900. Points are typically paid to buy down (reduce) the interest rate. Alternatively, in exchange for a higher rate, the lender may pay points to offset a homeowner's closing costs. These are called negative points.

Document Preparation Fee

Lender fee that offsets the cost of processing your loan for closing. Different companies may refer to them by different names, such as processing fees or underwriting fees.

Down Payment

The part of the property purchase price paid in cash, and not financed with a mortgage.

Draw Period

The agreed-upon interval of time when a lender will advance funds to you according to your loan terms.

Earnest Money

A deposit made in good faith when you make an offer on a home. The money is generally applied to the down payment at closing, and is not refundable.