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What that means is that if your new mortgage is a 30 year loan (360 months), then you get to deduct 1/30 of the points each year. Be careful though, because the first year you deduct less than that because you didn't have the loan for the whole year. The first year you deduct X*Points/360, where X is the number of months in the first year. Also be aware of the fact that if you sell the house or refinance the loan, you deduct all of the remaining points not yet deducted. So you get them all in the end.

Joe Varga
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