15 vs. 30-Year Mortgage: Which Is Right for You?
November 28, 2024
2 minutes
Around 30% of new homebuyers are uncertain about which mortgage term to choose.
For making an informed decision, understanding the differences between these two loan options is essential.
In this blog, we’ll explore the main differences, benefits, and drawbacks of both mortgage terms. This will help you choose the best option as per your finances.
What are the Different Mortgage Terms?
The period of your loan term can greatly impact your monthly payments and also the overall financial strategy.
The average mortgage length in the U.S. is typically 30 years. This is because it makes monthly payments more manageable for most homebuyers.
However, 15-year fixed mortgages are becoming increasingly popular due to their competitive rates. This mortgage term also provides quicker pay-off times to buyers.
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15-Year Mortgage vs. a 30-Year Mortgage
| 15-Year Mortgage | 30-Year Mortgage |
|---|---|
| A shorter loan term with higher monthly payments. | A longer loan term which results in lower monthly payments. |
| Lower total interest cost compared to longer terms. | Higher total interest cost over time. |
| Builds equity faster. | More flexibility in budget management. |
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As a great communicator with excellent negotiation skills, I focus more on establishing unbreakable ties between my clients, as opposed to just helping them achieve their real estate dreams. As a representative of both buyers and sellers, I understand how to lead a transaction process to ensure that the needs of both are met. My track record speaks for itself. Since I ventured into the industry in 2013 as a realtor, I have not only helped many buyers land perfect homes, but I have also assisted tons of owners and investors build wealth.