15-Year vs. 30-Year Mortgage Calculator
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What's the difference between a 15-year and 30-year mortgage?
A 15-year mortgage is designed to be paid off over 15 years. A 30-year mortgage is structured to be paid in full, or amortized, in 30 years. The interest rate is lower on a 15-year mortgage, and because the term is half as long, you'll pay less interest over the life of the loan. The monthly payment on a 15-year mortgage will be higher than with a 30-year mortgage for the same amount.
When to consider a 15-year fixed-rate mortgage
The main draws of 15-year fixed-rate loans are their lower interest rates and that they'll be paid off more quickly. Like any fixed-rate loan, they also offer stability; the monthly principal-and-interest payment won’t change no matter what happens to inflation or market interest rates.
But the monthly payment will be higher than that of a 30-year loan for the same amount due to the shorter term. The higher payment makes it harder to qualify for the 15-year loan.
When to consider a 30-year fixed-rate mortgage
When you want more room in your monthly budget, a 30-year mortgage could be the better choice because the monthly payments are lower, and more affordable, than on a 15-year loan.
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