Mortgage Buy-Up Rate Calculator
Calculate how much cash you receive when accepting a higher mortgage rate (lender credits). See your monthly payment increase, break-even, and whether credits make sense for your hold period.
Compare lender credit levels for a $350,000 loan at par rate 6.8%.
| Credits (pts) | Rate | Cash Received | Monthly Payment | Payment Increase | Break-Even (mo) |
|---|---|---|---|---|---|
| 0 (par) | 6.8% | $0 | $2,270 | $0 | — |
| -0.5 | 6.9% | $1,750 | $2,299 | +$29 | 61 mo |
| -1 | 7.0% | $3,500 | $2,329 | +$58 | 60 mo |
| -1.5 | 7.1% | $5,250 | $2,358 | +$88 | 60 mo |
| -2 | 7.3% | $7,000 | $2,388 | +$118 | 60 mo |
| -2.5 | 7.4% | $8,750 | $2,417 | +$147 | 60 mo |
| -3 | 7.5% | $10,500 | $2,447 | +$177 | 60 mo |
Over 30 years, compare the total cost of buy-up vs par rate — including when the crossover happens.
| Year | Cumulative Extra Cost | Credit Received | Net Position |
|---|---|---|---|
| 1 | $702 | $3,500 | +$2,798 |
| 2 | $1,403 | $3,500 | +$2,097 |
| 3 | $2,105 | $3,500 | +$1,395 |
| 5 | $3,508 | $3,500 | -$8 |
| 7 | $4,911 | $3,500 | -$1,411 |
| 10 | $7,016 | $3,500 | -$3,516 |
| 15 | $10,524 | $3,500 | -$7,024 |
| 20 | $14,032 | $3,500 | -$10,532 |
| 25 | $17,540 | $3,500 | -$14,040 |
| 30 | $21,048 | $3,500 | -$17,548 |
How to Use This Mortgage Buy-Up Rate Calculator
Enter your Loan Amount, your lender's Par Rate (the base rate with no points or credits), and the number of Lender Credit Points you are considering. Each point equals 1% of the loan amount back as cash at closing, in exchange for a rate increase of approximately 0.25% per point.
The Quick calculator shows your cash received at closing, the monthly payment increase, and the break-even — the number of months until the extra payments cost more than the credit you received. Use the Advanced tab to compare credit levels side-by-side and calculate the rate needed for a no-cost mortgage. The Pro tab models the 30-year cost crossover and the after-tax comparison.
Buy-Up Rate Formula
Cash Received = Loan Amount × (Credit Points ÷ 100)
Monthly Payment Increase = Payment(Buy-Up Rate) − Payment(Par Rate)
Break-Even (months) = Cash Received ÷ Monthly Payment Increase
No-Cost Rate = Par Rate + (Closing Costs ÷ Loan Amount) × 0.25% per 0.01 of loan
30-Year Net Cost = Extra Interest Paid − Credits Received
Example: 1-Point Buy-Up on a $400,000 Loan
Lender Credits to Cover Closing Costs
| Loan Amount | $400,000 |
| Par Rate | 7.00% |
| Buy-Up (1 point) | 7.25% |
| Cash Received | $4,000 (1% of loan) |
| Par Rate Payment | $2,661/mo |
| Buy-Up Payment | $2,729/mo |
| Monthly Increase | +$68/mo |
| Break-Even | 59 months (4.9 years) |
If you plan to sell or refinance before 59 months, the $4,000 credit saves money. If you keep the loan longer, you pay more than you received. For a planned refi in 2-3 years, taking the credit is clearly the better choice.