Basis Points (bps)
Interest rates are often stated in basis points which can be confusing. But, a basis point is simply one-hundredth of a percent, or 0.01%. Here’s an example: a Variable Rate Mortgage rate could be quoted at 20 basis points below the Prime Rate. This means the VRM rate would be the Prime Rate minus 0.20%.
About The Author
Don Scott
Don Scott is the founder of a challenger mortgage brokerage that is focused on improving access to mortgages. We can eliminate traditional biases and market restrictions through the use of technology to deliver a mortgage experience focused on the customer. Frankly, getting a mortgage doesn't have to be stressful.
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