Is a 15-year Mortgage a Good Idea?

If you consider the current difference in a 15-year loan is approximately ½% lower, then, yes, it may a good idea.  But, if you can’t afford the higher payment amortized over half the time of a 30-year, then, no, it may not be a good idea.

It may be good for some people based on their ability to make a higher payment if one of their goals is to build equity in their home faster or to pay it off sooner.

The term of the mortgage is a long-term commitment.  You are agreeing to make the specified payment each and every month.  If funds are tight one month, they don’t allow you to make the 30-year payment one month and go back to the 15-year payment the following month.

An alternative to getting a 15-year loan, would be to get the 30-year loan and make the payments as if it were a 15-year mortgage.  You won’t benefit from the lower interest rate available to shorter term mortgages, but the principal will reduce to match the shorter term.

$300,000 Mortgage

30 years

15 years

Interest Rate



Mortgage Payment



Unpaid balance at end of 10 years



Additional Monthly Payment



Additional Total Payments







To see what it would be for your situation, use the 30yr vs. 15yr Comparison.

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