Does Buying Points Make Sense Here?

[Kevin Piercy]

Hello everyone. This is my first real post / question so please be gentle :).

Basically I want to know if my math on break even point for purchasing points with a refi is correct and if it makes sense to you guys. So here is the template I saw in the sticky.

Your goals and story: Currently own two homes under VA loans and one is rented out. I'm looking to refi my rental home in NC to a conventional loan because I will be selling this house that I live in HI when I leave around the middle of next year. My current plan is to refi my NC rental to pull out the equity and use it as the starting point for purchasing additional buy and hold rentals. I would also like to get clear of all VA loans so that I can reset my entitlement and use it again in a couple of years.

Type of property:
NC Rental - SFH

Location of property: North Carolina near Fort Bragg, NC

Purpose of financing: cash out refinance

Type of financing sought: conventional investment refi

Current or prior ownership of real estate:
Own 1 rental in NC and own 1 that I live in in HI.

Occupancy: investment with long term traditional lease; first tenant was 3 years, second tenant moved out after a year, and third just moved in this month.

Value of property at present and/or your offer price: Approx $245,000 based on Zillow estimate. Possibly closer to $235,000-$240,000 based on comps.

After repair value: N/A

Anticipated or actual appraisal issues: Don't anticipate any issues. The biggest differentiator for my rental property is the significant amount of yard work we've done in the front and back yard. All the comps have pretty much the same interior because they were all new construction between 2012-2015. My property is one of the few in the area that aren't just mowed lots.

Current rents per month: $1575

Fair market rents per month: $1575

Down payment or equity: all the quotes I've gotten only allow up to a 75% LTV ratio for refinance. I've spoke to 8 different banks, a mix of national and local lenders.

Source of down payment funds, if applicable: N/A

Income Source:
Goverment employee

Gross monthly income (optional): N/A

Monthly debt obligations appearing on credit report, plus (if applicable) personal rent and alimony/child support/etc: N/A

FICO: Low 800s

Credit issues: None

Additional details:

So I went through the Better Mortgage link on the site got some more detailed quotes. For my NC rental refi the top end rate was 5.125% with the low end being 4.125%.

    Top End: Rate (5.125%), Point Cost ($1513), PITI ($998.45)
    Low End: Rate (4.125%), Point Cost ($4553), PITI ($883.73)

My research up to this point says I my break even if I went with the low end rate is 26.5 months. Is this correct?
I was planning to hold onto this house long term because even though the cash flow is pretty low it has been appreciating consistently (2-2.5% / year) without any rental issues.

Does it make sense to take advantage of this property to refi and use towards a down payment for other investment and does my math of the higher point cost make sense?

From my perspective, picking the 4.125% rate with the higher points meets my criteria of getting it off VA onto a conventional loan and pulling out the available equity. On a side note it looks like it would also reduce my current monthly payment (after including escrow for taxes and insurance) by about $20/month.

Thanks in advance!