There really is not a benefit in paying point.  Points are a means of buying down you interest rate.  The average Mortgage broker will tell you that paying a point will only take 3-5 years to recoup.  However the numbers do not bear this out.  Here is why! What if you put that extra money down on a property? It would reduce your loan balance. It would actually take 100 months to recoup what it cost you back.  And when it is all said and done the total cost would be $150 more. Considering the average person in MA refi's or purchases every 3-5 years.

Let's look at the numbers on a $300,000 Loan over 5 years

Points

At 6.0% and 1 point the monthly payment would be $1,799 and the total cost would $94,082.

No points

At 6.25% with a loan amount of $297,000 and no points the monthly payment would be $1,829 and the total cost would $93,932, which turns out to be $150 savings over 5 years. It would take 8.33 years to recoup the point. Based on a $30 dollar a month savings

Check back later on when to use a point, and its not what you think.  If you want to see the total cost analysis give me call.