What does 1 point and 2 points mean in a loan?

1 point in a loan is 1%,2 points is 2%.

For example, if you take out a loan of 100,000 yuan, then charging you one point is 100,000*1%=1,000 yuan, charging two points is 100,000*2%=2,000 yuan, and so on.

Expanded Information

Loan Principles

"The three principles" refers to security, liquidity, and efficiency, which is the fundamental principle of commercial banks' loan operations. Article 4 of the Law of the People's Republic of China on Commercial Banks stipulates that "commercial banks shall take safety, liquidity and efficiency as their operating principles, and shall carry out independent operation, bear their own risks, be responsible for their own profits and losses, and exercise self-restraint."

1, loan security is the primary problem faced by commercial banks;

2, liquidity refers to the ability to recover the loan according to the predetermined period, or the ability to quickly liquidate the loan without loss, to meet the customer's need to withdraw their deposits at any time;

3, efficiency is the basis of the bank's continued operation.

For example, the issuance of long-term loans, the interest rate is higher than the short-term loans, the efficiency is good, but the loan period is long will increase the risk, security is reduced, liquidity is also weakened. Therefore, the "three sexes" should be in harmony with each other, so that the loan can not be a problem.

Baidu Encyclopedia - Loans