Points are a percentage of the loan amount you are financing. They can be expressed in whole amounts, such as 1, 2, 3, etc. points. Or they can also be fractions, such as 1.375 would be "1 point three seven five points" (is how you would actually say that).
On a $100k loan amount 1 point = $1,000, 2 points = $2,000, and 1.375 points would be $1,375.
If it is worth paying points or not depends on how much of a lower interest rate & payment you would get by paying the points & how long you intend to stay in the loan for.
On the $100k example above, if you were to choose between 4% & 3.875%, the difference in payment would be $7/mo. Hypothetically if it cost you .375 in points ($375), then you divide $7 into $375 and you get 53.57 payments to break even, since you make 1 payment a month that translates into 53.57 months, or a little less than 4.5 years. Would you be in the loan for at least 4.5 years? Then you would breakeven, and every month after that you would save $7/mo more than you would if you didn't pay the points.
Now the above is just an example, the amount of points to buy down your interest rate by .125% isn't always going to be .375 in points - it can be greater or smaller. When you go to lock in your interest rate is usually when you need to make the decision on if you want to pay points or not.
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