I was adding points to my mortgage for years without really knowing why

My loan guy in Denver finally asked me point blank last month what I thought the points were for, and I just stared at him. I'd been paying extra upfront on every refi since 2015, thinking it was just a smart move to lower the rate. Turns out, with how often I move for work, I was never staying in the house long enough for those upfront costs to actually pay off. Has anyone else had a loan pro stop them and ask if they even understood their own strategy?

3 comments

3 Comments

jessicajackson21d ago

That's a rough lesson to learn the hard way. Points only make sense if you stay put long enough to break even. How many people just nod along without getting a clear explanation?

barbara_campbell21d ago

Ouch, @jessicajackson is right. Brutal lesson.

finleyw589d ago

Yeah but what's the actual break-even point though? Like how long do you have to stay for it to even matter?