Mortgage Points Calculator
Work out what discount points cost, how much they cut your monthly payment, and the break-even month — so you know whether buying down your rate is worth it.
With points vs without
| Scenario | Rate | Monthly P&I | Lifetime cost | Net cost by year 7 |
|---|---|---|---|---|
| No points | 6.750% | $1,945.79 | $400,485.94 | $135,809.14 |
| With points | 6.500% | $1,896.20 | $385,633.47 | $133,529.88 |
Lifetime cost adds interest paid over the full term plus the up-front point cost. The holding-period column counts payments made plus points, minus the principal you paid down, so selling early is compared fairly. Point pricing varies by lender — adjust the rate cut per point to match your quote. Estimates only, not financial advice.
What is the Mortgage Points Calculator?
The ByteTools Mortgage Points Calculator prices a rate buydown properly. One discount point costs 1% of your loan amount and typically shaves about a quarter of a percentage point off the rate, but whether that trade is worth it depends entirely on how long you keep the loan.
- Prices points as a percentage of the loan and shows the new rate
- Monthly payment saving and break-even month from cost ÷ saving
- Full-term interest comparison including the up-front point cost
- Net-cost comparison at your own selling or refinancing horizon
- Editable rate cut per point to match your actual lender quote
- Private in-browser math; estimates only, not advice
How to use the Mortgage Points Calculator
- 1
Enter your loan amount, the base rate quoted with no points, and the loan term.
- 2
Set how many discount points you are considering and how much each one cuts the rate.
- 3
Enter how many years you expect to keep the loan before selling or refinancing.
- 4
Read the point cost, the bought-down rate, the monthly saving and the break-even month.
- 5
Compare the two rows in the table — lifetime cost and net cost at your holding period — for the verdict.
About the Mortgage Points Calculator
The ByteTools Mortgage Points Calculator prices a rate buydown properly. One discount point costs 1% of your loan amount and typically shaves about a quarter of a percentage point off the rate, but whether that trade is worth it depends entirely on how long you keep the loan. This tool amortises the loan at both the base rate and the bought-down rate and tells you where the lines cross.
You get the cash cost of the points, the new rate, the monthly payment saving and the break-even month — point cost divided by monthly saving. It also compares the true net cost of both loans at whatever year you expect to sell or refinance, counting payments made and points paid minus the principal you paid down, so an early exit is judged fairly.
Point pricing is lender-specific, so the rate reduction per point is an editable input rather than a fixed assumption. All calculations happen locally in your browser and nothing is uploaded. Estimates only, not financial advice.
Frequently asked questions
How much does one mortgage point cost?
One point equals 1% of the loan amount, so on a $300,000 mortgage a single point costs $3,000, paid at closing. This calculator works out the cash figure for whatever fraction of a point you enter, including eighths.
How do I calculate the break-even on mortgage points?
Divide the total cost of the points by the monthly payment saving they buy. If a point costs $3,000 and lowers your payment by $50 a month, you break even after 60 months. Keeping the loan past that point puts you ahead; selling or refinancing sooner means you lost money.
How much does one point lower the interest rate?
About 0.25 percentage points is the common rule of thumb, but it genuinely varies by lender, loan type and market conditions — some quotes buy down far less. That is why the rate cut per point is an input here: put in the number from your actual Loan Estimate.
Are mortgage points worth it?
They are worth it if you keep the loan well past the break-even month. If you expect to move or refinance within a few years, the up-front cost rarely pays back. Use the holding-period comparison in this tool rather than the break-even month alone, since it also accounts for the principal you pay down.
Are discount points tax deductible?
In the US, discount points on a primary residence are often deductible as prepaid interest, sometimes fully in the year paid on a purchase and otherwise spread over the loan term. Rules differ by country and situation, so confirm with a tax professional — this tool does not model any tax effect.
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