Are You Leveraging Points to Offer Lower Rates? Your Competitors Are.

In today’s competitive lending environment, borrowers are more rate-sensitive than ever—and lenders are responding. One of the most effective tools in your toolkit is the use of discount points to offer lower interest rates. Whether you’re working with first-time homebuyers or seasoned investors, structuring deals with points can make your offers more attractive and help you stand out in a crowded market.

Recent studies reveal that discount points are widely used across loan types:

• 61% of home purchase loans
• 58% of no cash-out refinance loans
• 90% of cash-out refinance loans

This trend highlights a strategic opportunity: using points to structure more competitive deals for your borrowers.

Here’s how you can stay ahead:

• Quote with a point to present a lower interest rate upfront—this is a common tactic among top-performing lenders.
• Guide your borrower to include discount point costs in their purchase offer.
• Run the numbers together to identify the optimal balance between rate and cost.

Example Scenario:

For a $400,000 home purchase with 20% down (loan amount: $320,000) and a 740 credit score, each loan scenario pays your bank approximately 1.5 points. This structure gives your borrowers flexibility in monthly payments while maintaining your margins.

In today’s rate environment, discount points can be a powerful tool to close more loans and meet borrower expectations for lower rates.

Ready to boost your loan volume and deliver more value to your clients? Start quoting with points today—and see the difference it makes.