I find it easier to say than type so I'll try not to lose you. With most banks, interest rates comes at either a charge (paid buy borrower) or a credit (paid by lender). "Points" would be a charge paid by your buyer in order to secure a lower interest rate than the par rate offered. If your buyer took a rate higher than the par rate they'd recieve what's referred to as a lender credit which would be used to minimize settlement charges (closing costs, pre-paids, etc.). Bottom line, with points your buyer is paying for the rate.