Basis Point
What It Means
Basis Points, commonly referred to as “Bips”, are used in finance to refer to interest rates or other percentages. One Basis Point is equal to 0.01%.
Why It’s Important
Understanding the language that financial advisors and some Buyers commonly use is helpful to avoid confusion and misunderstandings in the negotiation process. If a Buyer indicates they are willing to increase their offered rate by 50 “Bips”, that means they are willing to raise the rate by 0.5%.
Related Terms
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