June 3, 2013
A 15 year fixed rate mortgage has many benefits. Can you name a few?
A 15 year fixed rate mortgage has many benefits. Can you name a few?
The first benefit is that you will be pay interest for 15 years rather than 30 and that will save you a lot of money. The second benefit is that a 15 year mortgage has a lower rate than a 30 year so you will also save money on that. You will own your house much sooner using the 15 year mortgage and that is also a benefit.
Nice job, Thomas. Let’s recap. The 15 year fixed rate mortgage provides a lower interest rate, much lower amount of interest paid on the loan, and a psychological boost in knowing the home will be paid off in 15 years. It also provides a locked in payment that will not change over the length of the loan.
When buying that home of your dreams, focus your efforts on keeping your payment under 30% of your gross income, put 20% down and utilize the 15 year fixed rate loan if at all possible. Your financial future will thank you.