Some homeowners are using a 15-year fixed rate mortgage in order to get out of mortgage debt faster. Even a low interest rate on a home loan can cause the total amount paid over the life of the mortgage to be a substantial amount, so homeowners are looking for ways to rid themselves of mortgage debt faster.
For example, a 30-year fixed rate mortgage has been one of the more popular home loans many people choose when either buying or refinancing. However, even at an affordable interest rate, this home loan can often cost almost double the original amount of the loan. It’s obvious that homeowners want to avoid paying double the amount their home is worth on their home loan so many are turning to options to help them get out of mortgage debt.
A 15-year fixed rate mortgage is one option that can help homeowners get out of debt in a short amount of time and at less cost overall. A 15-year mortgage often comes with a low interest rate as well and, obviously, has a shorter timeframe in which the home will be paid off. Yet, this type of mortgage usually comes with a higher monthly mortgage payment which turns many homeowners away from this home loan.
Some people simply will pay more than the minimum monthly requirement on their home loan and this is also a way in which they can get out of mortgage debt years ahead of schedule. However, some lenders may charge a penalty for doing this, so a homeowner must make sure it will be in their best financial interest to take this route.
No matter what method you use for getting out of mortgage debt faster it needs to be one that is affordable for you and one that you will be able to stick with until you are out of mortgage debt. Paying more in the present time, if a homeowner is able, will more than likely provide greater benefits down the road but this will take discipline, sacrifice, and the financial ability to do so.