The money or rebate paid to a lender or loan officer for giving a borrower a higher interest rate on a loan in exchange for lower upfront costs
A yield spread premium (YSP), or rebate, is the money or rebate paid to a lender or loan officer for giving a borrower a higher interest rate on a loan in exchange for lower upfront costs, e.g. “no points.” Typically, the higher the rate, the higher the YSP.