You are looking at a one-year loan of 10,000. The interest rate is quoted as 10 per cent plus 5 points. A point on a loan is simply 1 per cent (one percentage point) of the loan amount. Quotes similar to this one are very common with home mortgages. The interest rate quotation in this example requires the borrower to pay 5 points to the lender up front and repay the loan later with 10 per cent interest. What is the actual rate you are paying on this loan?