Mortgage Discount Points Calculator
Paying discount points lowers your mortgage rate — but the upfront cost only pays off if you keep the loan long enough. This calculator shows your break-even point in months and years.
How this calculator works
One discount point costs 1% of the loan amount and typically lowers your rate by about 0.25%. The calculator compares your monthly payment with and without points. The break-even point is the number of months it takes for the monthly savings to cover the upfront cost. If you plan to move or refinance before that date, buying points costs you money; if you plan to stay longer, you come out ahead.
Frequently asked questions
Are mortgage points tax deductible?
Yes — points paid to lower your interest rate are mortgage interest and deductible on Schedule A, but generally spread (amortized) over the life of the loan rather than deducted all at once in the year paid.
How much does one point lower my rate?
The industry standard is about 0.25 percentage points per point, but lenders set their own pricing. Always ask for a rate sheet showing your rate at 0, 1, and 2 points before comparing offers.
Are discount points the same as origination fees?
No. Discount points buy a lower rate and are tax-deductible mortgage interest. Origination or processing fees are lender charges for making the loan and are not points, even though both are often quoted as a percentage of the loan.
Disclaimer: Results are estimates for general information only and do not constitute financial, tax, or legal advice. Figures reflect 2026 rules and may change. Always confirm current limits and consult a qualified professional before making decisions. Official figures: IRS.gov · 2026 limits per IRS tax inflation adjustments.