How to Know if I Paid Points on My Mortgage
Learn how to determine if you paid points on your mortgage by reviewing key documents, understanding fee classifications, and verifying with your lender.
When taking out a mortgage, you may have the option to pay points upfront to lower your interest rate. These discount points reduce long-term costs but require an initial payment at closing. Many homeowners are unsure whether they paid points, especially if they didn’t closely review their loan documents at the time of purchase or refinancing.
You can determine if you paid points by reviewing key documents or contacting your lender.
Reviewing the Closing Disclosure
The Closing Disclosure is the most reliable document for confirming whether you paid points. This five-page form, required by the Consumer Financial Protection Bureau (CFPB), provides a breakdown of your loan terms and closing costs. Lenders must provide it at least three business days before closing.
Check page two under “Loan Costs.” Look for a line labeled “Points” or “Discount Points” under “Origination Charges.” This is usually listed as a percentage of the loan. For example, if you see “1.00% – $3,000,” it means you paid one point, costing $3,000 on a $300,000 loan. If no points are listed, you did not pay them.
Page three, under “Calculating Cash to Close,” summarizes the total amount needed at closing, including any points paid. If closing costs were higher than expected, this section can help determine if discount points contributed to the total.
Checking Form 1098
IRS Form 1098, the Mortgage Interest Statement, is another way to verify if you paid points. Your lender or mortgage servicer must send this form by January 31 each year. It details mortgage interest paid over the previous tax year and includes any points paid.
Look at box 6 on Form 1098. If there is a dollar amount listed, you paid points and may be eligible to deduct them on your tax return, subject to IRS rules. If the box is blank or shows zero, you either did not pay points or they were not deductible.
The tax treatment of points depends on whether you or the seller paid them. If the seller covered the points, you typically cannot deduct them. Points paid on a refinance are generally not fully deductible in the year they were paid and must be spread out over the loan’s term.
Distinguishing Points from Other Fees
Mortgage points are sometimes confused with other closing costs. While points lower the interest rate, other fees serve different purposes.
Loan origination fees compensate the lender for processing the mortgage but do not reduce the interest rate. These fees are often listed alongside points and may be expressed as a percentage of the loan amount. Some lenders combine origination fees and points under a single percentage, so reviewing the breakdown is important.
Mortgage insurance premiums (MIP) and private mortgage insurance (PMI) are separate from points. Borrowers who put down less than 20% on a conventional loan may be required to pay PMI, while FHA loans require MIP. These costs protect the lender but do not impact the interest rate. Unlike points, which are paid upfront, mortgage insurance is often a recurring monthly expense, though some lenders allow a lump sum payment at closing.
Prepaid interest is another fee that can be mistaken for points. This charge covers interest from the closing date until the first full payment period begins. Since mortgage payments are typically due on the first of the month, borrowers closing mid-month may need to prepay interest for the remaining days. While this cost is interest-related, it does not lower the loan’s rate.
Contacting Lender or Mortgage Servicer
If your loan documents do not provide a clear answer, contact your lender or mortgage servicer. They maintain records of loan transactions and can confirm whether discount points were included in your closing costs.
When reaching out, have your loan number and closing date ready. Some lenders may require a formal written request to release details, especially if your mortgage has been transferred to a new servicer. If your original lender no longer services the loan, the current servicer should still have access to historical records, though older loans may take longer to retrieve.