Definition
One hundredth of one percentage point, used to describe changes in interest rates and yields.
Example
A 25 basis point increase moves a rate from 6.50% to 6.75%.
Related terms
- Acceleration Clause
- Accrued Interest
- Adjustable Rate Cap
- Adjustable-Rate Mortgage
- Amortization
- Annual Percentage Rate
Frequently asked questions
What does Basis Point mean in real estate?
One hundredth of one percentage point, used to describe changes in interest rates and yields.
How is Basis Point used in practice?
A 25 basis point increase moves a rate from 6.50% to 6.75%.
This definition is provided for educational purposes. Legal and tax terminology can carry jurisdiction-specific meaning — confirm with a licensed professional before relying on it in a transaction.