Do Points make this a bad deal?

[Nicholas K.]

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*This link comes directly from our calculators, based on information input by the member who posted.

My lender wants to charge me 3.125 points on this deal.  Does it make it a bad deal? See report for loan details (30 Year at 3.875%). This is a duplex. 

[Jaysen Medhurst]

@Nicholas K., depends on how long you intend to hold the property. The points are likely what's enabling the low interest rate. If you were to take a loan with 5% interest and 0 points, your break-even point is 5 years. So, if you intend to hold longer than that, it's probably a good ideal to pay the up-front points. 

*We're of course putting aside the time-value of the $2100 and any potential opportunity costs.*

Overall, this looks like a good deal. Good monthly cash flow and decent CoC ROI. I would recommend planning for some initial repairs. There's ALWAYS something.