Department of Labor Federal Credit Union

Should I Pay Discount Points?

It is possible that ‘buying down’ your interest rate on your mortgage with discount points (a form of prepaid interest) will save you money in the long run. Use this calculator to help determine if paying additional discount points in exchange for a lower interest rate is a good option for you.

Mortgage Information

Mortgage Type:
Mortgage Term (Years):
Loan Amount:
Years to Sell or Refinance:

Loan 1
Enter the loan with the lowest points.

Interest Rate:
Discount Points:

Loan 2

Interest Rate:
Discount Points:

Loan 3

Interest Rate:
Discount Points:

Loan Amount

Enter the loan amount for all three loans.

Mortgage Term

Enter the term of your mortgage in years.

Annual Interest Rate

Enter the annual interest rate that you want to use for this loan.

Discount Points

Discount points are a form of pre-paid interest that you can pay as a means of obtaining a lower mortgage interest rate. One point equals 1% of the loan amount. Enter the discount points for this loan.

Years To Sell or Refinance

Enter the number of years you plan to hold this mortgage before you either sell the property, refinance or pay it off.


Department of Labor Federal Credit Union

Serving employees and contractors who work for the Department of Labor, their families and associated organizations. See website for details.

200 Constitution Ave
Rm S-3220
Washington, DC 20210-0001
(202) 789-2901

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