Mortgage Points & Economic Break-Even Calculator
Compare two rate offers with points, lender credits, fees and the debt remaining at your chosen date.
Your inputs
Use consistent units and periods. Defaults are examples.
Your result
Check the assumptions below before relying on a result.
Formula and method
Upfront cost = principal × points/100 + other cash fees. Simple payment payback = extra upfront cost ÷ monthly saving when both are positive. Economic cost at month h = upfront cost + sum of payments discounted at the entered monthly discount rate + remaining principal discounted to month h. Search each month for the first non-negative offer-B advantage and any later reversal.
Worked example
For a 100,000 loan over 360 months, 6% gives a 599.55 monthly payment and 5.5% gives 567.79. Paying 2,000 more up front takes about 62.97 months to recover through payment savings alone. The economic crossing can occur at another month because principal balances differ.
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Open calculator ↗How to use this result
- Use two offers with the same amount and term.
- Enter the actual offered rates; a point does not imply a fixed rate reduction.
- Separate points from other fees and credits to avoid double counting.
- Choose how long you may keep the loan and compare remaining balances as well as payments.
- Check the economic timeline for a reversal if one offer gives cash credit.
Questions about this calculation
Why is economic break-even different from payment payback?
The loan with a different rate can pay principal down at a different pace. Comparing only monthly cash savings ignores that remaining liability.
What if offer B saves no monthly payment?
A positive extra upfront cost has no payment-savings payback if savings are zero or negative. The result is shown as not defined.
Does one point always reduce the rate by the same amount?
No. Enter the two actual rate offers. Pricing varies by lender, product and market conditions.