How long do I need to live in my home so that it's worth it paying a point to get a discount on the rate?

Answer 1

It would depend on several factors, size of the loan being taken as the most important, and also the term, program options, and other matters like how much would the discount be on your interest rate?

Wish I could have helped you more on this one, feel free to drop me a line if you'd like to discuss it in depth.

Answer 2

That would depend upon the difference in the payment, which of course is based on the interest rate. Figure it both ways. Then divide the points (1% of the loan amount, per point) by the difference in monthly payments. That's your payback period in months.

A purist would also factor in the time value of the money spent on the point(s). This would increase the payback period somewhat.