Mortgage points on an adjustable rate mortgage (ARM) work exactly the same as fixed rate mortgages. However, most ARMs adjust in five or seven years. This is important because ARMs are most of the time refinanced. If they aren’t refinanced, then the points aren’t applied once the loan starts adjusting. The lower interest rate only applies to the fixed rate time period. The fixed interest rate period is typically five to seven years. Therefore, it is really important to calculate the break-even points. However, most of the time it makes no since to pay points on an ARM.