Mortgage Points Break-Even Calculator
Find when paying discount points pays off.
Enter your values
Enter the loan amount in $.
Enter the rate without points in % APR.
Enter the rate with points in % APR.
Enter the points purchased in points.
Enter the loan term in years.
Results update instantly as you type — no submit needed. Your values are remembered on this device, and the shareable link reopens the calculator with exactly these numbers.
- Cost of points
- $5,250.00
- Payment without points
- $2,270.09
- Payment with points
- $2,155.01
- Monthly savings
- $115.08
- Break-even period
- 45.6 months (3.8 years)
Quick answer
Buying points pays off once your monthly savings exceed the upfront cost, which typically takes several years — worthwhile mainly if you'll keep the loan that long.
Break-even months = points cost / monthly savings
At a glance
| What it does | Find when paying discount points pays off. |
|---|---|
| Category | Real Estate |
| Inputs needed | Loan amount, Rate without points, Rate with points, Points purchased, Loan term |
| Main output | Cost of points |
| Formula | Break-even months = points cost / monthly savings |
| Cost | Free — no sign-up, no download |
How to use the Mortgage Points Break-Even Calculator
- 1Enter the loan amount and the rate quoted with and without points.
- 2Enter how many points (1 point = 1% of the loan) you'd buy.
- 3Compare the break-even period to how long you expect to keep the loan.
Inputs explained
- Loan amount($)
- Enter the loan amount in $.
- Rate without points(% APR)
- Enter the rate without points in % APR.
- Rate with points(% APR)
- Enter the rate with points in % APR.
- Points purchased(points)
- Enter the points purchased in points.
- Loan term(years)
- Enter the loan term in years.
Worked example
Using the values the calculator loads with:
Inputs
- Loan amount350000 $
- Rate without points6.75 % APR
- Rate with points6.25 % APR
- Points purchased1.5 points
- Loan term30 years
Results
- Cost of points$5,250.00
- Payment without points$2,270.09
- Payment with points$2,155.01
- Monthly savings$115.08
- Break-even period45.6 months (3.8 years)
Frequently asked questions
Are points tax-deductible?
Often yes on a primary residence purchase, but rules vary — check with a tax professional.
What if I sell before break-even?
You lose money on the points, since the monthly savings never recovered the upfront cost.
What do I need to enter into the Mortgage Points Break-Even Calculator?
Just 5 values: loan amount, rate without points, rate with points, points purchased, loan term. Every field starts with a realistic example, so you can change one number at a time and watch the result update instantly.
How does the Mortgage Points Break-Even Calculator work out the answer?
Buying points pays off once your monthly savings exceed the upfront cost, which typically takes several years — worthwhile mainly if you'll keep the loan that long. It applies the formula Break-even months = points cost / monthly savings and shows the working so you can check each step by hand.
Is the Mortgage Points Break-Even Calculator free, and do I need an account?
It is completely free with no sign-up, no download and no usage limit. Everything is calculated in your browser, so the numbers you type never leave your device.
Results are estimates for general information. For medical, legal, structural or financial decisions, confirm with a qualified professional.