Homeowners or homebuyers looking for a low interest mortgage and who want to pay less over the life of their home loan may want to consider a 15-year fixed rate mortgage. A 15-year mortgage comes with a lower interest rate than the traditional 30-year fixed rate mortgage and you save money over the long run, when factoring in interest.
By getting a lower interest rate and paying off your mortgage faster you can save a huge amount of money, compared to the 30-year fixed rate mortgage. In some cases, the 30-year fixed rate mortgage can end up costing you double the value of your home loan, so you are losing in the end.
However, what keeps many people from the 15-year fixed rate mortgage is, again, compared to the 30-year fixed rate mortgage, a higher monthly mortgage payment. Many people that are unable to afford the mortgage payment that comes with a 15-year fixed rate mortgage turn to the 30-year fixed mortgage, but once more they are losing money over the long run.
Yet, if you are in the financial position to do so, you may benefit from checking on what a 15-year fixed rate mortgage can do for you. Obviously, refinancing to or buying a home with a 15-year fixed rate mortgage isn’t something you should jump into, but for those able to afford buying a home, a 15-year fixed might be a better option. However, you need to assess your personal financial situation before moving forward and be sure a 15-year fixed rate mortgage is right for you.