© 2016 Shmoop University, Inc. All rights reserved.

Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Basis Point


One hundredth of one percent. It's the measure bankers use to talk about mortgages: they talk about mortgage rates going up or down a certain number of basis points.


If mortgage rates are quoted today at 6.274% and next week at 6.284%, they have gone up one basis point. If they move two weeks later to 6.074%, they've gone down 20 basis points from the original quote.