Points break-even calculator
Paying points lowers your rate. This shows how long it takes for the lower payment to earn back what the points cost, and what they are worth for the years you expect to keep the loan.
How this calculator works
It builds both loans month by month and compares the interest paid on each. The cost of the points counts on day one. Where the line crosses zero is your break-even. Your Mortgage Plan shows the same break-even for any option with points. For more, see points and the break-even.
Learn more
Common questions
What is a mortgage point?
Discount points are an offer to pay money upfront in exchange for a permanently lowered interest rate. One point is 1% of the loan amount.
When are points worth it?
Points are worth it when you keep the loan past the break-even month. If you might sell or refinance before then, the points cost more than they save.
Why are there two break-even numbers?
The simple one divides the cost by the monthly savings. The exact one compares the interest you pay on each loan month by month, which counts the slightly faster payoff on the lower rate. They are usually close.
What about lender credits?
A lender credit works the opposite way. You accept a slightly higher rate, and the lender pays part of your closing costs. It can make sense if you expect to move or refinance soon.
See it with your own numbers
It starts with a conversation. Daniel builds your Mortgage Plan from it: every loan option that fits, side by side.