What is the formula to determine benefit of buying down a mortgage interest rate?

I run the calculation this way. One point equals 1% of the loan amount. How much does the lower interest rate lower your monthly payment? Divide the amount you paid by the monthly savings. It will take that many months to break even. Will you be in the home that long? and what could you have done with that cash in the meantime? Usually, unless you plan on being in the house a long time, 5+ years, it's not worth it.

coupons

face blush