Discount Point Return ("DiPR") provides information analysis to compare financial return on investing in lowering mortgage rate. When a borrower selects a rate with a certain pricing, there could potentially be lower rates that save more money relative to additional pricing for the lower rate.
DiPR is an innovative analysis which calculates an investment return between two rates: (i) a higher rate which has lower pricing and (ii) a lower rate which typically has higher pricing. It computes the difference in pricing and compares this difference to total interest savings over various periods and generates an annualized investment return assuming the difference in pricing as investment and total interest savings as investment return.
DiPR identifies price dislocations which are simply represented in DiPR values with high investment returns.