Points Can Lower a 30-Year Mortgage Rate

On September 30 one lender in FreeRateUpdate’s network advertised three rate options on the same 30-year fixed purchase loan: 7.125% with no points, 6.875% with 0.818 of a point and 6.75% with 1.411 points.

For a $550,000 example repaid in 360 monthly payments, the 1.411 points, at 1% of the loan each, come to about $7,760 at closing and cut principal and interest, not counting taxes or insurance, by about $138 a month, from $3,705 to $3,567. Most of that cut comes from the first 0.818 points, which buy two thirds of it for under 60% of the points charge. What the points are worth to a borrower also turns on the other closing fees and how long they keep the loan.

All ten of the best advertised purchase rates in our network’s September 30, 2026 capture carried points, and they’re advertised interest rates, not APRs or personalized quotes.