James R. answered • 05/26/19
Tutor
5.0
(58)
Take Advantage of 30+ years of Technology, Science and Math
A "point" in this context is 1 percent (%) of the amount financed. If the down payment is 20 percent (%), then the amount financed is 80 percent (%) of 240,000 or 192,000 (units are not stated, but the math is the same for any currency). Then 2 points of 192,000 is 2 percent (%) of 192,000 = 3840. If the currency is dollars, then the points paid at closing would be $3840.
James R.
By the way, my answer assumes that the amount financed is only the balance of the house price less the down payment. There are situations where the amount financed could include other things. The same math would apply, but the correct "amount financed" would need to be used.05/26/19