CalculateRealEstateROI

Financing

Is a rate buydown worth it?

Yes if breakeven is under 4 years and you'll hold the loan past breakeven.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Yes if breakeven is under 4 years and you'll hold the loan past breakeven.

Expanded explanation

Each point typically buys 0.25% rate reduction. Compute monthly savings ÷ buydown cost = breakeven months. Hold longer than that and the buydown wins.

Examples

  • $5k buydown → $50/mo savings → 100 month breakeven (too long).

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