Many homeowners often want to pay off their mortgage debt quickly in order to save money and simply own their home outright. While there may be a few different ways in which one can go about erasing mortgage debt in a timely manner, one of the more common ways is simply getting a 15-year fixed rate mortgage.
A 15-year fixed rate mortgage often comes with a lower interest rate than a 30-year mortgage, depending upon the homeowner, and will obviously get a homeowner out of debt in half the time. What many homeowners fail to realize is that with a common 30-year mortgage the overall payment at the conclusion of the mortgage will be, in many cases, double the original amount thanks to interest.
However, many homeowners have refinanced their home loan for a 30-year fixed rate mortgage, locked in a low interest rate, and are now required to pay a low monthly mortgage payment. If concern over the monthly payment is a homeowner’s main focus then this type of mortgage might be in their best interest. Yet, homeowners who can afford to do so often pay more than their minimum monthly payment on this type of mortgage and by doing so can get out of debt years ahead of schedule.
A 15-year fixed rate mortgage usually comes with a higher monthly mortgage payment and a 30-year fixed rate mortgage but if a homeowner can afford this higher monthly payment they may be able to pay off their home faster and with less overall cost. Many homeowners will choose this option rather than simply paying more each month on their home loan due to the fact that many mortgage lenders will charge a penalty if a homeowner pays off their mortgage early.
When it comes to erasing mortgage debt fast the main focus should be on affordability. While some homeowners may end up paying almost double the original mortgage amount, that is a sacrifice that must be made in many cases when a higher monthly mortgage payment cannot be met. In the end, a homeowner must decide if they can afford to pay a higher monthly mortgage payment and get out of mortgage debt faster or if they simply need to keep a roof over their head and must settle for a longer mortgage with lower monthly payments.