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Sarah Martinez · Golden Key Realty
Is paying points worth it?
How long you have to keep the loan before the discount points pay for themselves.
Should I buy down the rate?
The points pay for themselves after
3 yr 4 mo
Cost of the points
$6,000
Monthly saving
$148/mo
Net over 7 years
$9,830
| Payment at 6.750% | $3,892 |
| Payment at 6.375% | $3,743 |
| Saved each month | $148 |
| Paid at closing for the points | −$6,000 |
| Lower balance after 7 yearsA cheaper rate also pays the loan down slightly faster | $3,367 |
| Net benefit over 7 years | $9,830 |
You keep the loan about 7 years and break even in 3 yr 4 mo, so the points are worth paying — $9,830 ahead by the time you sell or refinance.
While you're here
Monthly payment
What would the monthly payment be?
Affordability
What price should I be shopping at?
Budget → price
I can spend $X a month. What does that buy?
Cash to close
How much money do I need on the day?
Rent vs buy
Am I better off renting?
PMI drop-off
How long am I paying mortgage insurance?
Refinance
Is it worth refinancing?
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