A 15-year fixed rate mortgage is one option that many homeowners use when they want to get out of mortgage debt fast. Obviously, a 15-year fixed rate mortgage is going to be shorter, when it comes to the repayment time frame, then a 30-year fixed rate mortgage, for instance, but there are other benefits as well.
Many people will use a 30-year fixed rate mortgage on their home in order to get a low monthly mortgage payment but what they don’t consider is the fact they will be paying much more over the life of their home loan. Some homeowners may pay almost double what their original home loan amount was on a 30-year fixed mortgage, whereas this cost is drastically reduced on a 15-year fixed mortgage.
Homeowners should be aware that even with a lower interest rate and a lower-cost overall, a 15-year fixed rate mortgage will more than likely come with a higher monthly mortgage payment than most other, longer-term mortgages. However, the homeowner who can afford this higher payment may stand to save more money over the life of their home loan.
While some people may pay more money each month than their home loan payment requires, which is also another way to get out of mortgage debt faster, a homeowner needs to make sure they can afford to pay their home loan off early. Some lenders may charge a penalty if the homeowners pay off their mortgage early or a homeowner simply may be unable to meet the costs of the monthly payment on a 15-year fixed rate mortgage.
Homeowners are advised look at their personal financial situation and formulate a mortgage payment plan that is within their budget and financial means before choosing one route to take.