Mortgage Points Break-Even

Decide whether paying discount points to lower your mortgage rate is worthwhile by calculating the break-even time, free online.

Loan amount

Rate without points (% per year)

Points to buy

Rate reduction per point (%)

Loan term (years)

Years you expect to keep the loan

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One discount point costs 1% of the loan and typically lowers the rate by about 0.25%. Break-even months = cost of points ÷ monthly payment saving. If you will keep the loan longer than the break-even period, buying points saves money.