With mortgage rates remaining high, more homebuyers are looking at purchasing mortgage points as a way to reduce their interest rates.

• A mortgage point typically costs 1% of the total loan amount and can lower the interest rate by about 0.25% for the life of the loan. While this can mean significant savings over time, the upfront cost of buying points may not always be worthwhile, especially for those planning to sell or refinance in the near future.
• Buyers need to calculate their breakeven point—the time it will take for the interest savings to outweigh the cost of the points—and determine if they plan to stay in the home long enough for it to make sense.
• Ultimately, purchasing mortgage points in 2024 could be a smart move for long-term buyers but requires careful financial planning.