Many homeowners are getting either a 30-year fixed rate mortgage or refinancing for the same, in order to take advantage of the low interest rates that are currently available. A low interest rate on your mortgage can bring about a lower monthly payment and for many that are financially strained, this is a welcome option for a mortgage.
However, what many people fail to realize is that a 30-year mortgage can bring about a higher cost over the life of the mortgage. Even with a low interest rate, homeowners can sometimes pay almost double the price of their original mortgage loan when they have completed paying their home loan.
While this may not be a concern for many homeowners that are just looking to keep a roof over their head, others that see their home as an investment typically feel that if the price of the home rises, they will profit, but this is not the case. If you are looking to treat your home as an investment then perhaps a 15-year fixed rate mortgage might be ideal. It comes with a higher monthly payment, but the cost over the long run is cheaper, when interest is factored in.
However, homeowners that, again, just want a lower interest rate on their home so that can have a more affordable monthly mortgage payment may want to look into a low interest 30-year fixed rate mortgage. Yet, before you refinance or buy a home, be sure you are on the firm financial ground to do so.