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Free points vs cash calculator for mortgages. Calculate whether to pay points for rate discount or take cash back at closing. Our calculator uses break-even analysis to determine the best mortgage strategy for your situation.
Last updated: February 2, 2026
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5.1 years
Time to break even
$19,545
Total savings
488.63%
Return on investment
Paying points is a moderate investment with longer payback period but still provides savings.
Moderate ROI with longer payback period
Low PriorityPaying points for rate discount
Standard rate without points
Taking cash back instead of points
| Category | Item | Amount | Description |
|---|---|---|---|
| Loan Details | Loan Amount | $400,000 | Total loan amount |
| Loan Details | Interest Rate | 6.5% | Base interest rate |
| Loan Details | Loan Term | 30 | Loan term in years |
| Points Analysis | Points Cost | $4,000 | Cost of buying points |
| Points Analysis | Points Discount | 0.25 | Interest rate discount from points |
| Points Analysis | Rate With Points | 6.25% | Interest rate after points discount |
| Payment Comparison | Monthly Payment (With Points) | $2,463 | Monthly payment with points |
| Payment Comparison | Monthly Payment (Without Points) | $2,528 | Monthly payment without points |
| Payment Comparison | Monthly Savings | 65.40329226628319 | Monthly savings from points |
| Interest Analysis | Total Interest (With Points) | $486,633 | Total interest paid with points |
| Interest Analysis | Total Interest (Without Points) | $510,178 | Total interest paid without points |
| Interest Analysis | Total Interest Savings | $23,545 | Total interest saved with points |
| Break-Even Analysis | Break-Even Months | 61.159000738286785 | Months to break even on points |
| Break-Even Analysis | Break-Even Years | 5.096583394857232 | Years to break even on points |
| ROI Analysis | Net Benefit | $19,545 | Net benefit from paying points |
| ROI Analysis | ROI Percentage | 488.6296303965471% | Return on investment for points |
Decision analysis
Points vs Cash
Calculate points vs cash back decision
Points analysis
Points Cost
Calculate mortgage points costs and savings
Break-even analysis
Break Even
Calculate break-even point for points
ROI analysis
Return on Investment
Calculate ROI for mortgage points
Cash back analysis
Cash Back
Calculate cash back benefits
Strategy analysis
Mortgage Strategy
Calculate optimal mortgage strategy
For a $400,000 loan with $4,000 points cost:
Break-Even
3.2 years
Net Benefit
$8,500
Our points vs cash calculator analyzes the financial impact of paying mortgage points versus taking cash back. The calculation applies break-even analysis to determine the optimal mortgage strategy based on your timeline and financial goals.
Break-Even = Points Cost ÷ Monthly SavingsWhere break-even determines if points are worth the investment
Shows break-even analysis and ROI calculations
The points vs cash decision depends on your break-even point and how long you plan to stay in the home. Points provide long-term savings through lower interest rates, while cash back provides immediate funds. The break-even point determines which option is more financially beneficial.
Need help with other mortgage calculations? Check out our mortgage points calculator and Utah mortgage calculator.
Get Custom Calculator for Your PlatformResult: Break-Even = 5.1 years, Net Benefit = $8,500, ROI = 212%
This points investment has excellent ROI with reasonable break-even period.
$400,000 loan with $2,000 points cost (0.5% discount)
Break-Even: 2.1 years, Excellent Investment
$400,000 loan with $8,000 points cost (0.125% discount)
Break-Even: 12.3 years, Take Cash Back
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