Should you pay discount points to lower your interest rate?
What is this? Each mortgage discount point costs 1% of your loan and typically lowers your rate by 0.25%. This calculator shows whether paying points saves you money — and how long it takes to break even on the upfront cost.
Key insight: If you plan to stay in the home less than the break-even period, skip the points. If you'll be there 10+ years, points usually pay off.
Who it's for: Home buyers deciding between different lender offers with different point structures.
Loan Details
Decision Analysis
Points Cost
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upfront cost
Rate With Points
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new interest rate
Monthly Savings
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vs. no points
Break-Even Period
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months to recoup cost
Total Interest Saved
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over loan life
Verdict
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Estimates only. Consult a mortgage lender for actual rate quotes with and without points.