When to buy a point when you apply for mortgage

1 point in loan will cost you around 1% of the loan amount; the benefit is
that your interest rate will be reduced by 0.25%

for example, if you apply for a 30 year fixed loan with amount of $500,000
at interest rate of 3.5%.

if you decides to buy a point, it would cost you an additional $5000 at
closing. your interest rate will be reduced to 3.25%.

some basic break even analysis will help you decide whether you should buy
the point:
at 3.5% with no point, your monthly payment would be 2,245
at 3.25% with one point, your monthly payment would be 2,176

so you save $69 each month. It costs $5000. So it takes around 72 months to
break even. In other words, if you don't refinance or sell your home in 72
months, you should buy a point. Otherwise, you should not.