Mortgage Points Calculator
See whether buying mortgage discount points is worth it. Points cost money upfront to lower your rate — this shows how many months it takes for the monthly savings to pay back that cost.
Your details
- Cost of points
- $6,000.00
- Monthly payment saved
- $99.70
- Payment with points
- $1,896.20
Payment with vs without points
- Payment without points
- $1,995.9151%
- Payment with points
- $1,896.2049%
Formula
Cost of points = loan × points%. Monthly savings = payment at the higher rate − payment at the bought-down rate. Break-even = cost ÷ monthly savings.
How it works
Each point is 1% of the loan and typically lowers your rate by roughly 0.25%. If you'll keep the loan past the break-even point, points save money; if you might move or refinance sooner, they usually don't.
Frequently asked questions
What is a mortgage point?⌄
A discount point is a fee equal to 1% of the loan amount, paid upfront at closing to permanently lower your interest rate for the life of the loan.
When are points worth buying?⌄
When you'll keep the mortgage past the break-even month — the point at which accumulated monthly savings exceed the upfront cost. Sell or refinance earlier and you lose money.
How much does one point lower my rate?⌄
It varies by lender and market, but roughly 0.25% per point is common. Always compare the specific rates your lender quotes with and without points.
Sources & methodology
Compares fixed-rate payments with and without points and divides the upfront cost by the monthly saving. Excludes the time value of money and tax effects.
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