Short Answer
A 30-year mortgage offers lower monthly payments but more total interest over the life of the loan. A 15-year mortgage has higher monthly payments but significantly less total interest and builds equity faster. Choose the 30-year if you want lower payments and more cash flow flexibility. Choose the 15-year if you can comfortably afford the higher payment and want to pay off your home sooner.
The choice between a 15-year and 30-year mortgage comes down to your budget and financial goals. On a $350,000 loan at 6.5%, a 30-year fixed mortgage would have a monthly payment of about $2,212, and you would pay roughly $446,000 in total interest over the life of the loan. A 15-year mortgage at 5.75% would have a monthly payment of about $2,906, but you would pay only about $173,000 in total interest. The 15-year saves you over $270,000 in interest but costs nearly $700 more per month. Consider your income stability, other financial goals like retirement savings and college funds, and how long you plan to stay in the home. Many buyers choose the 30-year for flexibility and make extra principal payments when they can, giving them the best of both options.
Bob's Advice
Redfin Senior Agent · AI Certified Agent
I have seen buyers choose both paths successfully. The 30-year gives you breathing room, which is important for first-time buyers or anyone with a tight budget. The 15-year is a great choice if you are further along in your career and want to own your home free and clear sooner. I recommend talking to a lender and running both scenarios. You might be surprised which one works better for your specific situation. I can connect you with lenders who will lay out the numbers clearly.
Related Questions
Ready to Take the Next Step?
Every situation is unique. Let us talk about your specific goals and create a plan that works for you.