Mortgage Points Calculator
Discount points cost money now to lower your rate for the life of the loan. Whether that pays off depends on how long you keep the mortgage.
5 yr to break even
- Monthly savings
- $134.37
- Payment with points
- $2,597.05 was $2,731.42
- Net savings over term
- $40,372
How it works
Payments at both rates are computed for the same loan and term. Break-even is the points cost divided by the monthly saving; net savings also account for interest over the full term.
Frequently asked questions
Are mortgage points worth buying?
It depends on how long you'll keep the loan. Points cost money upfront to lower your rate for the life of the loan, so they pay off only if you stay past the break-even month the calculator computes — points cost ÷ monthly payment savings.
How much does one discount point typically cost and save?
One point usually costs 1% of the loan amount and lowers the rate by roughly 0.125–0.25 percentage points, though the exact trade varies by lender and market. Enter your specific quote above rather than relying on that rule of thumb.
What if I refinance or sell before the break-even month?
You lose money on the points — you paid for a lower rate you didn't keep long enough to recoup. If there's a real chance you'll move or refinance within a few years, a shorter break-even (or no points at all) is usually the safer choice.
Are points tax-deductible?
Often yes, for points paid on a loan to buy or build your primary home, subject to IRS rules and limits — this calculator doesn't model the tax effect, so check with a tax professional for your situation.