Need to lock my rate ASAP-Buy points or no?

[Karissa Sampson]

I understand the fact that my money is worth more now than in the future and will be rehabbing the property (BRRRR). I plan to cash-out-refi the property in 12 months after the rehab. Would like to get my my money back out of the deal but leave enough equity in it that it continues to cash flow.

By not paying points, my rate is 5.5% on $447k and I get $1,110 lender credit at closing.

By paying points, I pay $560 for a rate of 5.375%, or pay $2,797 for 5.25%, or pay $7,271 for 5.0%.

Paying for a rate of 5.0% doesnt make sense to me but is it worth it to pay $560 for a rate of 5.375%? I fully anticipate that rates will continue to go up and by the time I refinance the BRRRR, I could be paying 6,7,8+ %. If thats the case, I may end up keeping the original mortgage that I'm doing today and just finding a HELOC that I can access the equity in for the BRRRR.

Does it make sense to pay anything for a lower rate right now if the intention is to refinance in a year or less? If yes, then how much?