What Are the Advantages of a 15-Year Mortgage over a 30-Year Mortgage?
A 15-year mortgage has two distinct advantages over a 30-year mortgage:
First, a 15-year mortgage will reduce the accumulation of interest over time. The longer your principal remains outstanding, the more interest will build up. In a 15-year mortgage, you will pay back that principal earlier, which will reduce your costs in the long run.
Second, a 15-year mortgage will often include a lower initial interest rate than a 30-year equivalent, further reducing total costs paid by you, the borrower.
However, remember that a 15-year mortgage is only appropriate if you can truly afford to meet the expenses and higher monthly costs.
- What Is a Mortgage?
- What Type of Loan Should I Get for My Home?
- What Are the Different Types of Mortgage Loans?
- What Is the Process of Applying for a Mortgage?
- What Is the Difference Between a Housing Loan and a Mortgage Loan?
- What Is the Difference Between Government-Insured Loans and Conventional Loans?
- What Is a Down Payment?
- How Much Down Payment Will I Need to Provide?
- Are There Any Mortgage Loans with No Down Payment?
- What Is an Escrow Account?
- What Is Home Equity?
- What Is the Difference Between a Loan and a Mortgage?
- How Do Mortgages Work?
- Where Can I Get a Mortgage?
- What Should I Look for in a Mortgage?
- Should I Pay My Mortgage Early?
- What Is the Average Mortgage Length?
- What Are the Advantages of a 30-Year Mortgage over a 15-Year Mortgage?