15-Year Fixed-Rate Mortgages

If you can afford the higher monthly payments, 15-year fixed-rate mortgages allow you to pay off your home in half the time, saving tens of thousands in interest in the process. You still have the security of an unchanging payment, and you build equity much faster.

Advantages

  • Faster Outright Ownership

    You’ll own your home outright in half the time of a 30-year loan.

  • Save Money

    Because lenders are exposed to fewer years of risk, they offer lower interest rates. And you’ll save a boatload of interest over the loan term.

  • Build Equity Faster

    Your higher payments build equity much faster.

Disadvantages

  • Higher Payments

    You’ll pay around 50 percent higher each month. This can become a squeeze when emergency financial situations arise.

  • Opportunity Cost

    Because you’re paying more every month on your mortgage, you have less money to put into a retirement account or other investments.

  • Qualify for Less

    Due to the higher payments, you’ll qualify for a smaller loan than you would with a 30-year mortgage.

  • Tax Deductions

    You’ll pay less interest, but you’ll also then be able to deduct less interest over the term of your loan.

Would a 15-year fixed-rate mortgage be right for you?

When weighing loan options, do these traits sound like you?

  • Can you afford a much higher payment?
  • Does the interest paid bother you?
  • Do you still want a predictable monthly payment?
  • Do you want to own your home outright in half the time?

If you said “Yes” to those questions, a 15-year fixed mortgage could be the key to building equity fast.