Results 1 to 7 of 7
  1. Member
    Interested in Language
    • Member Info
      • Native Language:
      • Chinese
      • Home Country:
      • China
      • Current Location:
      • China

    • Join Date: Sep 2007
    • Posts: 129
    #1

    What does "deduct any points the lender charges" mean?

    I don't understand this paragraph.

    "Make more of loans. You can deduct any points the lender charges when you finance a property. If refianancing, you can deduct when the new mortgage is paid off."

    Here "point" means 1 percent of the loan amount. But does this sentence mean "When you buy a real estate and get some loans from a bank, you can pay no tax"? The second sentence, does it mean "when you buy a real estate for the second time and have paid off the new mortgage, you can deduct some tax?" so Make more of loans means "make more loans from the bank"?
    Last edited by emsr2d2; 29-Nov-2016 at 10:23. Reason: Removed non-functioning code

  2. VIP Member
    Interested in Language
    • Member Info
      • Native Language:
      • American English
      • Home Country:
      • United States
      • Current Location:
      • United States

    • Join Date: Apr 2009
    • Posts: 12,462
    #2

    Re: What does "deduct any points the lender charges" mean?

    You can deduct the interest (points) paid on a home loan from your taxable income. This will typically lower the amount of income tax that you have to pay.

    It doesn't mean "make more loans" it means take advantage of the tax benefit that the loan allows you to.

  3. VIP Member
    Interested in Language
    • Member Info
      • Native Language:
      • American English
      • Home Country:
      • United States
      • Current Location:
      • United States

    • Join Date: Dec 2015
    • Posts: 11,607
    #3

    Re: What does "deduct any points the lender charges" mean?

    Quote Originally Posted by registered View Post
    I don't understand this paragraph.

    "Make more of loans. You can deduct any points the lender charges when you finance a property. If refianancing, you can deduct when the new mortgage is paid off."

    Here "point" means 1 percent of the loan amount. But does this sentence mean "When you buy a real estate and get some loans from a bank, you can pay no tax"? The second sentence, does it mean "when you buy a real estate for the second time and have paid off the new mortgage, you can deduct some tax?" so Make more of loans means "make more loans from the bank"?
    The first sentence means "get more financial benefits from borrowing money." The article refers to American tax law, under which you can sometimes subtract the money you pay to get a loan (the "points") from the income you have to pay tax on.

    Suppose you earn $100,000 in a tax year. You borrow $300,000, paying two points. You can deduct $6,000 from your taxable income, so you only have to pay income tax on the $94,000 balance.
    I am not a teacher.

  4. Member
    Interested in Language
    • Member Info
      • Native Language:
      • Chinese
      • Home Country:
      • China
      • Current Location:
      • China

    • Join Date: Sep 2007
    • Posts: 129
    #4

    Re: What does "deduct any points the lender charges" mean?

    Quote Originally Posted by GoesStation View Post
    The first sentence means "get more financial benefits from borrowing money." The article refers to American tax law, under which you can sometimes subtract the money you pay to get a loan (the "points") from the income you have to pay tax on.

    Suppose you earn $100,000 in a tax year. You borrow $300,000, paying two points. You can deduct $6,000 from your taxable income, so you only have to pay income tax on the $94,000 balance.
    I guess "paying two points" means paying 2 points of interest to the bank, am I right?

  5. Moderator
    Retired English Teacher
    • Member Info
      • Native Language:
      • English
      • Home Country:
      • England
      • Current Location:
      • England

    • Join Date: Jun 2010
    • Posts: 25,898
    #5

    Re: What does "deduct any points the lender charges" mean?

    registered, please state the source and author of your quoted text.

  6. VIP Member
    Interested in Language
    • Member Info
      • Native Language:
      • American English
      • Home Country:
      • United States
      • Current Location:
      • United States

    • Join Date: Dec 2015
    • Posts: 11,607
    #6

    Re: What does "deduct any points the lender charges" mean?

    Quote Originally Posted by registered View Post
    I guess "paying two points" means paying 2 points of interest to the bank, am I right?
    Yes.
    I am not a teacher.

  7. Member
    Interested in Language
    • Member Info
      • Native Language:
      • Chinese
      • Home Country:
      • China
      • Current Location:
      • China

    • Join Date: Sep 2007
    • Posts: 129
    #7

    Re: What does "deduct any points the lender charges" mean?

    Quote Originally Posted by Rover_KE View Post
    registered, please state the source and author of your quoted text.
    OK. This is a text titled "Ways to Keep More Cash" taken from "Reader's Diegest" (October, 2002), but it doesn't mention the author.

Similar Threads

  1. [Idiom] Are "calling rates" and "call charges" different?
    By jasmin39 in forum Ask a Teacher
    Replies: 2
    Last Post: 07-Dec-2015, 09:36
  2. Replies: 5
    Last Post: 17-Sep-2013, 16:15
  3. Replies: 2
    Last Post: 14-Mar-2012, 05:50
  4. The data "point" vs "points"
    By Route21 in forum Ask a Teacher
    Replies: 3
    Last Post: 05-May-2011, 06:02
  5. "PREPOSITIONAL PROBLEM" and "SUSPENSION POINTS"
    By Jesule in forum Ask a Teacher
    Replies: 4
    Last Post: 30-Apr-2006, 16:29

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •