How do I calculate the break-even on mortgage points?

Calculating the break-even on mortgage points means dividing the upfront cost of the points by the monthly savings the lower rate produces, which shows how many months pass before the savings outweigh what was paid upfront. A buyer who plans to keep the loan past that break-even point generally benefits from paying points, while someone likely to sell or refinance sooner usually does not. The exact break-even period depends on the specific loan amount, rate difference and points cost quoted by the lender. A lender can run that calculation on an actual quote rather than a rough estimate.