How it works
One point represents 1% of the loan amount. The two offers use the same principal and term; enter their actual quoted rates separately. The calculator finds principal-and-interest payments, subtracts them to find monthly cash savings, and compares those savings with the extra upfront cash cost.
Inputs and units
| Input | Example value | What to enter |
|---|---|---|
| Loan amount | $300,000.00 | Required unit: $. Must be greater than zero. |
| Same loan term for both offers | 30 years | Required unit: years. Use a whole number. Must be greater than zero. Allowed range: 1–50. |
| Annual rate without points | 6.5 % | Enter the percentage as a number: for 15%, enter 15. Use the annual rate. Use a non-negative value. Allowed range: 0–100. |
| Annual rate with points | 6 % | Enter the percentage as a number: for 15%, enter 15. Use the annual rate. Use a non-negative value. Allowed range: 0–100. |
| Discount points | 1 points | Required unit: points. Use a non-negative value. Allowed range: 0–20. |
| Other extra upfront costs | $0.00 | Required unit: $. Use a non-negative value. |
| Months you expect to keep the loan | 60 months | Required unit: months. Use a whole number. Use a non-negative value. Allowed range: 0–600. |
Worked example
Show example inputs and results
This example is generated by the same calculation engine using the starting values in the form. Your own inputs produce your own result.
- Loan amount
- $300,000.00
- Same loan term for both offers
- 30 years
- Annual rate without points
- 6.5 %
- Annual rate with points
- 6 %
- Discount points
- 1 points
- Other extra upfront costs
- $0.00
- Months you expect to keep the loan
- 60 months
Complete example results
- Cash-flow break-even
- 31 months
- Extra upfront cost
- $3,000.00
- Monthly payment without points
- $1,896.20
- Monthly payment with points
- $1,798.65
- Monthly payment saving
- $97.55
- Net cash savings over your holding period
- $2,853.15
Reading the result
Match the rate period to the payment period. Fees and taxes absent from the inputs are not added automatically; compare totals with the same cost coverage.
Questions and answers
Can I use the example values for my own calculation?
The example values illustrate the calculation. Replace every input with your own information, especially dates, rates and the selected operation.
Does one point always lower the rate by a fixed amount?
No. The rate reduction depends on the offer. Enter the quoted rate with points instead of assuming a standard reduction. The rate with points must be lower for this break-even comparison.
Why are some results rounded?
Results display up to 8 decimal places. Calculations use the unrounded values; very small values use scientific notation. JavaScript floating-point arithmetic can introduce tiny rounding differences.
Are my inputs sent to a server?
The calculator processes inputs in your browser. Its code does not send your values to a server.
Method sources: consumerfinance.gov · consumerfinance.gov