PlinthHome Lending
Talk to someone

Day one · Do the points pay back before I leave?

Points and buy-down

A discount point is a bet on how long you stay. The cost is certain and paid on day one; the saving arrives a month at a time, and only after the break-even month is any of it yours.

Every figure this page produces is illustrative. The rate you type is an assumption, not an offer; nothing here is a quote, an application or a commitment to lend. The assumptions in force are printed at the bottom of the page.

What you are working from

The loan, not the purchase price. A point is priced off this figure.

From a quote you have been given. Plinth publishes no rates.

Lenders sell them in fractions. An eighth of a point is normal.

Ask the lender for this, in writing, for the exact number of points you are considering. A quarter point is a convention, not a guarantee.

Compared against the break-even month below. This input does not change the maths — it decides whether the maths is good news.

Recalculates as you type. There is no submit button and nothing is sent.

Break-even Illustrative

—

Working it out.

Set the years you expect to stay and this reads against your break-even month.

Both sides of the trade

Cost, paid at closing
$0—
Saving, every month
$0—
  • Rate without points—
  • Rate with points—
  • Payment without points$0
  • Payment with points$0
  • Net saving over the full term, after the cost$0

Every figure in this panel is illustrative and moves with the inputs on the left.

Cumulative cost of each option, month by month

The points line starts higher by exactly the cost of the points and climbs more slowly. Where they cross is the break-even month, marked with the dashed rule. Left of it you have lost money; right of it you are ahead. Illustrative.

Cumulative cost of each option, month by month
Show these numbers as a table

Monthly payment against points bought

Zero to three points in quarter-point steps, at the reduction per point you typed. The flat dashed line is the payment with no points at all — the gap between the two lines is what you are buying, and the table gives what each step costs and when it pays back. Illustrative.

Monthly payment against points bought
Show these numbers as a table

Three things about points that are true regardless of the numbers

A point costs one per cent of the loan

Not one per cent of the price, and not a flat fee. On a $378,000 loan a single discount point is $3,780, paid at closing, in cash, on top of everything else closing costs already ask for.

What a point buys is set by the market, not by a rule

A quarter of a point off the rate is the number people quote, but it is a convention rather than a law. The real reduction moves with the day, the programme, the loan size and the lender, and it is not linear — the third point rarely buys what the first one did. That is why the reduction per point is a box you fill in from an actual quote.

The break-even month is the whole decision

Points are a bet that you will still be paying this loan long enough to get the money back one monthly saving at a time. Everything else about them is arithmetic; only the horizon is a judgement.

This site is organised around the years you are actually in a loan rather than the day you sign it, and points are the cleanest case for that. If you expect to be gone — sold, refinanced, paid off — before the break-even month, points lose money. Not “are less efficient”: lose money, in the plain sense that you handed over cash at closing and did not get it back. The rate on the sheet is lower and you are still worse off.

The assumptions in force

  • A discount point is one per cent of the loan amount. That is the definition, and it is the one figure on this page that is not an assumption.
  • The reduction per point is yours to supply. It is set by the lender and by the market on the day, it is not fixed at a quarter point, and it is not linear across several points. This page applies the figure you typed uniformly, which flatters larger point purchases.
  • Break-even is measured in simple cash, undiscounted. Money paid at closing is treated as worth the same as money saved in month 84. Discounting it would push the break-even month later, not earlier.
  • No tax treatment is modelled. Points on a purchase may be deductible in the year paid and on a refinance are generally spread over the loan term, which changes the answer and depends on your filing position.
  • Origination points are not discount points. A fee called “points” on a loan estimate may buy nothing at all. Only a charge that lowers the rate belongs in this calculator.
  • The comparison assumes the loan runs to term at a fixed rate and that nothing is refinanced, recast or paid off early. Any of those endings truncates the saving and leaves the cost where it is.
  • Nothing here is a quote, an offer, an application or a commitment to lend.

No obligation, and no transmission

Ask a person about this

A broker needs six things to say anything useful. This form asks for exactly those and nothing else — no date of birth, no Social Security number, no credit pull.

This form does not send anything. It validates what you type and then stops. Nothing is stored, nothing is transmitted, no cookie is set and nobody will call you. The demonstration is the point — on a real build one function call inLeadForm.astro would hand this to a CRM.

(816) 555-0147