Should I Pay Points?

Depends how long you're going to keep the loan...long term absolutely...short term (under 3-4 years) no. With rates as low as they are now and if you intended to keep the loan 15/30 years buy down the rate.

See how much it is going to cost. EX: if you have a loan amount of $400,000 and they want to charge you 1.5 points(1.5% of the loan amount) that would be $6000 and it will save you $150 per month than that means it will save you about $1800 per year, that means it will take about 3.5 years to make it back before you truly are saving money. Every year after that it is worth it, but if you sell or refinance before that time frame you are throwing money away to the bank. Hope this helps. Kyle. Bayview Home Loans WA

In the basic view the longer you are planning to be in the home, the more paying points may make sense. However, the short and long term tax advantages or disadvantages may make one approach better than another. I would recommend you work with a mortgage professional who has the wherewithall to provide you detailed analysis so you can make a side by side comparison of the different scenarios. I use software specifically designed to provide my clients answers so they can tell me which process is right for their goals. Be happy to provide you the same. All my best, Deborah