This is not a simple question, by any definition. However, it would be helpful if you were to provide a definition. What does "best option" mean? "Best option" must have some element of the length of the option. Do you REALLY intend to hold this mortgage for 30 years? It is not very common, any more.
Do you know how to calculate the payments over the 30-year term?
I get, assuming monthly payments:
i = 5.5%
Points paid up front = 0
Total Paid over the 30-year lifetime = $378,147.47
i = 5.3%
Points paid up front = 1
Total Paid over the 30-year lifetime = $367,982.90
i = 5.15%
Points paid up front = 2
Total Paid over the 30-year lifetime = $359,953.47
If "Total Paid" is not your measure of value, these calculations are not of much value. Do you get to amortize the points? There remain a few question in order to provde a better answer. Is this for a class or are you contemplating a real mortgage?
