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Dmitrij [34]
3 years ago
10

PLEASE HELP WILL MARK AS BRAINLIEST!!!!! When is it a good idea to purchase discount points on a mortgage? Explain in complete s

entences.
Mathematics
1 answer:
olganol [36]3 years ago
8 0

When discount points are paid, the bank collects a one-time fee at closing in exchange a lower mortgage rate to be honored for the life of the loan.

The banks consider this payment to be "prepaid mortgage interest". Meanwhile, mortgage interest is tax-deductible for eligible tax-filers so, for many mortgage borrowers, there's a tax advantage to paying discount points.

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