Calculating your cost of points is straightforward once you know the Mortgage Points formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Mortgage Points Calculator.
What is Mortgage Points?
The Mortgage Points calculation tells you your cost of points from a few simple inputs. The figure you are solving for here is the cost of points, expressed in INR.
The Mortgage Points formula
The core formula is:
Cost of points = Loan amount × Discount points ÷ 100Here is what each input means:
- Loan amount — a money amount. Example: ₹40,00,000.
- Discount points — a number. Example: 1.
How to calculate it step by step
- Write down the loan amount (for example, ₹40,00,000).
- Write down the discount points (for example, 1).
- Apply the formula above to get your cost of points.
- Double-check the result with the Mortgage Points Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Loan amount | ₹40,00,000 |
| Discount points | 1 |
| Cost of points | ₹40,000 |
With loan amount of ₹40,00,000 and discount points of 1, the cost of points works out to ₹40,000.
Example 2
With loan amount of ₹80,00,000 and discount points of 1, the cost of points works out to ₹80,000.
| Result | Value |
|---|---|
| Cost of points | ₹80,000 |
Example 3
With loan amount of ₹20,00,000 and discount points of 1, the cost of points works out to ₹20,000.
| Result | Value |
|---|---|
| Cost of points | ₹20,000 |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
- Annual rates must be converted to the period you are calculating for (for example, divide an annual rate by 12 for a monthly figure).
Prefer not to do the maths by hand? — the Mortgage Points Calculator does it instantly, for free, with the formula and a worked example built in.
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