Loan Origination Fee, Commitment Fee, Discount Fee, Warehousing Fee, Funding Fee, etc. Also, when there is a heavy demand upon the money market because of business needs, military requirements or other government borrowing, the result is that money for home mortgages becomes scarce and more expensive. When this occurs, more points can be charged.
Points balance the market.
Points are not set by government regulation but by lender individually. Not without jeopardizing the sale. Points charged on an FHA or conventional loan are usually not changed from commitment time to settlement. Homes can sell faster because more buyers can qualify with the lower down payment requirement, lower interest rate, long term loans with lowest monthly payments. Sellers receive all cash for their equity to reinvest in a new home or other investment.