Examples of Bona fide discount points in a sentence
Bona fide discount points are interest and are not subject to the two percent limitation.
Bona fide discount points defined For purposes of clause (ii), the term "bona fide discount points" means loan discount points which are knowingly paid by the consumer for the purpose of reducing, and which in fact result in a bona fide reduction of, the interest rate or time-price differential applicable to the mortgage.
Bona fide discount points should be excluded from points and fees since they relate to payments on interest.
Bona fide discount points are those that reduce the interest rate “based on a calculation that is consistent with established industry practices.” The inclusion of originator compensation is a significant development—it may dramatically shrink the “headroom” available under the points and fees test.
Note that up-front fees a creditor charges consumers to recover the costs of loan-level price adjustments imposed by secondary market purchasers of loans, including the GSEs, are not considered bona fide third-party charges and must be included in points and fees.▪ Bona fide discount points.