Many homeowners are gravitating toward 15-year fixed-rate mortgages over the more traditional 30-year fixed-rate mortgages. There are plenty of benefits to opting for the shorter mortgage length of 15 years, but a 30-year mortgage is still the best option for many home buyers.
Pros: With a 15-year mortgage, you own your home in half the time. Once your mortgage is paid off, you’ll have more cash available to save or cover other large expenses. You’ll also pay far less in interest on the loan, and even qualify for a lower interest rate in some cases.
Cons: Payments on a 15-year mortgage will be 10 to 15 percent higher than on a 30-year mortgage. That difference is enough to make a home unattainable for many people. Since mortgage interest can be tax deductible, it’s also possible to recoup some of the difference in interest on a 30-year mortgage during tax season.
The length of your mortgage really comes down to what’s best for you and what’s best for your family. If the home you want or need is unaffordable with a 15-year mortgage, opt for a 30-year. If it’s important to you to pay off your home sooner, budget more money for your house payment and go for a 15-year. Try using this calculator to compare a 15-year to a 30-year.