Home mortgage lenders usually charge points on a loan to avoid exceeding a legal limit on interest rates or to be competitive with other lenders. As an example, for a two-point loan, the lender would lend only $98 for each $100 borrowed. The borrower would receive only $98, but would have to make payments just as if he or she had received $100. Suppose that you receive a loan of $130,000, payable at the end of each month for 30 years with an interest rate of 9% compounded monthly, but you have been charged three points. What is the effective borrowing rate on this home mortgage loan?