Should I Pay Mortgage Points?

Compare paying less at closing with paying more now for a lower fixed rate.

Use two fixed-rate quotes for the same loan amount and loan length. Enter the actual rates offered; one point does not buy a fixed rate reduction. All fees and points are paid in cash here.

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1. The loan and how long you may keep it

Loan amount ($)

This is the money borrowed, not the home price. Points are calculated on this amount. Use Compare Mortgage Offers if fees are financed or the loan lengths differ.

Use the same amount for both options.

Loan length (months)

Both quotes must use this same full loan length. We use monthly principal-and-interest payments until the loan is repaid.

15 years = 180; 30 years = 360.

Compare after (years)

Choose how long you think you will keep the loan before selling, refinancing or paying it off. We compare interest and cash-paid fees at that same date, including the debt still owed.

Try 3, 5 or 10 years.

2. Your quote without discount points

Rate without points (%)

Ask for a zero-discount-point quote for the same loan. Enter 6.5 for 6.5%. Other lender fees may still apply.

Copy the interest rate, not APR.

Other loan fees without points ($)

Add nonrefundable closing fees such as origination, appraisal and title fees. Exclude taxes, insurance prepaids and refundable escrow deposits. Enter net fees after applicable lender credits; do not count points here.

Leave out down payment and escrow deposits.

3. Your quote with discount points

Lower rate with points (%)

The calculator cannot tell you which rate a lender will sell for one point. Compare quotes from the same lender and product to isolate the points tradeoff.

Use the lender’s actual lower-rate quote.

Discount points (%)

One point is 1% of the loan amount. If your quote lists dollars instead, divide points dollars by loan amount and multiply by 100. Enter 1.5 for one and a half points.

1 point on $250,000 costs $2,500.

Other fees with points ($)

Use the net nonrefundable fees for this quote, excluding the points entered above. Different other fees can change the answer. All net fees must be zero or positive.

Keep discount points separate above.

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Your estimated results

Enter your numbers or try the example. We’ll explain the payment, cost and timing differences.

How this estimate works

Monthly fully amortizing fixed loans use the same principal and term. Points cost = principal × points ÷ 100. Borrowing cost = interest paid + net cash-paid fees, equivalent to payments + remaining debt + cash fees − original principal. Simple payment recovery divides the extra upfront cost by the monthly payment reduction; the separate cost crossing also accounts for different remaining balances. Taxes, mortgage insurance, investment returns, APR, prepayment penalties and financed points are excluded. Compare official Loan Estimates. A first crossing is not a guarantee of future savings.

Monthly calculations use full precision; displayed dollars are rounded. The lender or servicer’s figures may differ.

Read the CFPB explanation → · Source checked October 5, 2026.