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"Discount Points are used to "buy" your interest rate lower. This is known as a rate "buydown." A general rule of thumb is that one full Discount Point will lower your fixed interest rate .250% or your adjustable rate .375%. These points lower the interest rate for the entire term of the loan. There is usually some flexibility by the lending institution in determining the actual buydown formula, but less than with Origination Point(s). "
Actually, I mentioned it was a fixed rate... Which would imply that the buydown related to a permanent discount.
I think you're getting confused here. =)
I'm not talking about a TEMPORARY related 3/2/1 buydown.
So... maybe you should pay attention if you want to chastize me on the proper usage of the word buydown? =)
Because, when talking about fixed rate mortgages, like mine is, I used it in the proper fashion.
Penis envy?
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