how are points different from my down payment?

Discount points are a charge by the lender, and are separate from your down payment. In general, discount points are used to offset the lender cost of a lower interest rate: the more the points, the lower the rate.

Points are charged by the lender. The difference is origination fee or points are charged by the lender or broker for compensation purposes. Discount points are charged to get a rate or the rate you are given. They have nothing to do with your down payment but are additional fees that will be paid by you at closing.

Down Payment reduces your initial loan balance (amount of the loan). Points reduce your interest rate, but not your loan balance. Yes, point add to your upfront costs. There are advantages and disadvantages to both depending on your specific situation. Sitting down with a lender to review your options will help you pick the best one.