Formulas and 2026 figures checked & updated: July 2026
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How to Use the Mortgage Points Calculator
- Enter the amount you expect to borrow.
- Enter the quoted rate without points and the lower rate offered after buying points.
- Enter the number of points and loan term.
- Compare the break-even month with how long you realistically expect to keep the loan.
What This Calculator Does
This tool answers whether the upfront cost of mortgage discount points is recovered through a lower monthly principal-and-interest payment.
A break-even result is useful only if you keep the mortgage beyond that point. Selling, refinancing, or paying off the loan earlier can prevent you from recovering the cost.
Formula
Break-even months = (Loan amount × Points ÷ 100) ÷ Monthly payment savingsOne discount point is modeled as 1% of the loan amount. Both payments use the standard fixed-rate amortization formula. The calculator compares principal-and-interest payments only; taxes, insurance, lender credits, financed points, and the possible tax treatment of points are excluded.
Examples
One-point buy-down
$400,000 for 30 years; 6.75% without points, 6.25% with one point.
The calculator compares the exact amortized payments and divides the $4,000 point cost by monthly savings.
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Methodology
One discount point is modeled as 1% of the loan amount. Both payments use the standard fixed-rate amortization formula. The calculator compares principal-and-interest payments only; taxes, insurance, lender credits, financed points, and the possible tax treatment of points are excluded.
Frequently Asked Questions
What is one mortgage point?+
One discount point normally costs 1% of the mortgage principal. On a $400,000 loan, one point costs $4,000. The rate reduction attached to a point is set by the lender and is not universally fixed.
Are discount points the same as origination points?+
No. Discount points buy down the interest rate. Origination points compensate the lender for making the loan and do not necessarily lower the rate.
Should I buy points if I may refinance?+
Usually only when the expected refinance date is later than the break-even date, with enough margin to justify uncertainty. A refinance ends the savings from the old loan.
Is the Mortgage Points Calculator exact?+
The arithmetic follows the formula shown on this page, but the result is an estimate because real-world rates, fees, taxes, timing, and provider rules can differ. Use the actual figures from your lender, plan, or agency before making a decision.
Does this calculator store my financial information?+
No. The calculation runs in your browser. Saved results remain in local browser storage and are not submitted as an application or professional financial record.
Can I save my results?+
Yes. Use “Save results” to store a snapshot. Without an account it remains in this browser. If you log in, saved scenarios sync securely to your SmartRates account so they are available on your other devices.
How do I share my calculation?+
Click “Share” in the toolbar to copy a link (or open your device’s share sheet). The link encodes your exact inputs, so whoever opens it sees the calculator pre-filled with the same numbers and the same result.
Can I email my calculator results?+
Yes. Click “Email results” to open your default email application with the current inputs, results, and calculator link already included. Review the message and choose the recipient before sending.
Can I export or print my results as a PDF?+
Yes. Click “Export PDF” to open a clean, printable summary of your inputs and results that you can save as a PDF or print. It includes a timestamp and a link back to the calculator.
How accurate are the calculator results?+
The arithmetic follows the formula and assumptions documented on this page. The result is still an estimate because actual rates, fees, taxes, timing conventions, eligibility rules, and provider calculations can differ. Use figures from your official quote, statement, contract, or tax form before making a financial decision.
Which inputs have the biggest effect on the result?+
Rate, time, starting balance, recurring payments or contributions, and fees usually have the largest effects. Change one input at a time to create a conservative, expected, and optimistic scenario instead of relying on a single forecast.
Are taxes, fees, and inflation included?+
Only when they appear as an input or are explicitly described in the methodology. Do not assume an omitted cost is zero. Review the formula and methodology sections to see exactly what is included before comparing the result with an outside quote.
Can this calculator predict future rates or returns?+
No. A calculator projects the assumptions entered; it cannot predict market returns, inflation, variable interest rates, tax-law changes, or provider decisions. Rerun the calculation with several assumptions to understand the range of possible outcomes.
Why might my lender, bank, broker, or tax software show a different result?+
Professional systems may use daily timing, transaction dates, compounding conventions, rounding rules, account-specific fees, credits, eligibility details, or regulations that a general-purpose calculator cannot know. A small difference can be rounding; a large difference usually means an assumption or included cost is different.
Disclaimer: Calculations are for informational purposes only and do not constitute professional financial advice. Please consult with a certified professional before making financial decisions.