On Mortgage — Buying Points

: You can generally only deduct interest (including points) on the first $750,000 of mortgage debt ($375,000 if married filing separately).

Buying points is essentially a long-term investment. It is generally a good idea if: buying points on mortgage

The most critical factor in deciding to buy points is your —the time it takes for your monthly interest savings to equal the upfront cost of the points. : You can generally only deduct interest (including

: Each point usually reduces your interest rate by 0.25 percentage points (e.g., from 7.00% to 6.75%). : Each point usually reduces your interest rate by 0

The cost and impact of points are generally standardized across the industry, though specific offers vary by lender:

: If you think you'll refinance soon because market rates are falling, paying for a permanent buydown now is a wasted expense.

: If you plan to sell or move within 3–5 years, you likely won't recoup the upfront cost.